Scottish Mortgage Reports Strong Annual Results with 27.4% NAV Return, Highlights SpaceX and AI Investments

Scottish Mortgage Investment Trust has put in a strong set of annual results for the year to 31 March 2026. The headline number is a 27.4% net asset value, or NAV, total return with borrowings at fair value, comfortably ahead of the FTSE All-World Index return of 18.0%.

That is the good news. The more balanced view is that Scottish Mortgage is still a high-conviction, high-volatility trust, and the long-term picture depends heavily on when you started investing. This year was strong, but the five-year record is still weak versus the global index.

Scottish Mortgage annual results 2026 – the headline numbers investors need

NAV is the value of the trust’s assets minus its liabilities. For investment trusts, it is one of the key measures because it shows what the portfolio is worth beneath the share price noise.

Metric	2026 result	Why it matters
NAV total return (fair value debt)	27.4%	Beat the FTSE All-World Index by 9.4 percentage points
Share price total return	26.8%	Shareholders broadly captured the portfolio rebound
FTSE All-World Index total return	18.0%	The benchmark Scottish Mortgage is trying to outperform
Net assets	£13.8 billion	Up from £12.1 billion last year
Ongoing charges	0.33%	Still very low for a global growth trust with private assets
Total dividend	4.57p	Up 4.3%, extending the dividend growth record to 43 years

The trust also reported net return after taxation of £3,101.6 million, up from £1,217.8 million a year earlier. Most of that came from investment gains of £3,151.9 million, which tells you this was a valuation recovery year rather than an income story.

Why Scottish Mortgage beat the global index this year

The big driver was simple – growth stocks came back into favour, especially those linked to artificial intelligence, or AI. Scottish Mortgage has leaned hard into that theme, both through listed holdings such as NVIDIA, TSMC and ASML, and through private companies including Anthropic and SpaceX.

Management’s message is that we are still early in the AI buildout. Whether you fully buy that or not, it clearly helped performance this year. The trust’s style works best when markets reward long-duration growth and future winners rather than short-term defensive businesses.

That said, investors should not cherry-pick one good year and forget the rest. Over five years, Scottish Mortgage’s NAV total return was 12.8%, versus 68.2% for the FTSE All-World Index. Over 10 years it looks much better, with NAV total return of 435.2% against 233.9% for the index. In other words, timing matters a lot here.

SpaceX was the star performer – but it is also a concentration risk

SpaceX was the standout contributor and is now the trust’s largest holding by a wide margin. At the year end, it represented over 19% of the Company’s assets. That is huge.

There is no point pretending that is normal diversification. It is not. If SpaceX keeps compounding, that concentration could look brilliant. If sentiment changes or the valuation comes under pressure after listing, it could hurt returns in a big way.

The company says continued strong operational execution led to a significant upward revaluation. The manager also noted that SpaceX filed for a public listing in April 2026, although Scottish Mortgage will be subject to a lock-up period after the IPO, meaning it cannot sell immediately.

For retail investors, this is the key point: Scottish Mortgage offers access to private giants before or during their move to public markets, which is unusual. That is a genuine edge. But it also means valuation risk is higher and less transparent than owning only listed shares.

Scottish Mortgage private companies strategy just got more flexible

After the year end, shareholders approved a targeted change to investment policy. This gives the managers limited extra flexibility to invest in private companies when the portfolio is above the 30% limit, with additional capacity of up to £250 million, subject to annual shareholder approval.

I think this matters more than it may first appear. Scottish Mortgage is doubling down on the idea that many of the world’s most interesting growth businesses stay private for longer, and the trust does not want to miss follow-on rounds just because of a technical cap.

The trust’s Level 3 investments, which are the least observable and mostly private assets, rose to £6,418.1 million from £3,784.8 million. That is a major chunk of the portfolio. Supporters will say this is exactly why Scottish Mortgage is different. Critics will say it makes the trust harder to value in real time. Both views are fair.

Debt, buybacks and discount to NAV – the plumbing matters too

The financial position looks solid enough. The overall cost of debt was approximately 3.6%, and gearing – borrowing used to invest more – fell to 11% from 13%. That reduction was due to portfolio growth rather than debt being cut in absolute terms.

The board also stayed active on the discount. An investment trust discount is when the share price trades below NAV. At the year end, the discount to NAV with borrowings at fair value was 9.5%, compared with 9.0% a year earlier.

That is slightly disappointing on the face of it, especially after heavy buybacks. The trust bought back 122,884,921 shares at a total cost of £1,311.8 million during the year. Still, the board says the year-end discount was distorted by a sharp NAV jump on the final day, and post year-end the shares moved to a modest premium. Since then, shares have been issued at a premium.

That is actually quite important. A move from discount to premium can improve sentiment fast, and it gives the trust the option to issue shares rather than just mop them up.

Dividend growth continues, but income is still not the main attraction

The total dividend for the year rose 4.3% to 4.57p per share, with a final dividend of 2.97p payable on 10 July 2026. Scottish Mortgage has now increased its dividend for 43 consecutive years.

That is a nice record, but let’s keep it in perspective. This is not an income trust. Revenue earnings were £25.6 million, while the investment case remains overwhelmingly about capital growth.

My view on Scottish Mortgage results – strong rebound, same big risks

This was a very good year and the trust deserves credit for it. Outperforming the FTSE All-World Index by that margin, while keeping charges at 0.33% and maintaining access to both public and private growth companies, is a strong combination.

But the result does not change the basic character of Scottish Mortgage. This is still a trust for patient investors with a strong stomach. It is concentrated, exposed to private company valuations, and closely tied to a handful of huge themes such as AI, China and disruptive technology.

The bullish case is easy to see – if AI keeps driving capital spending and holdings like SpaceX, Anthropic, ByteDance and NVIDIA continue to execute, Scottish Mortgage could have plenty more upside. The bearish case is just as clear – if AI hype cools, private market valuations wobble, or large positions disappoint, the ride could get rough again.

For me, these results strengthen the argument that Scottish Mortgage remains one of the most interesting growth trusts in the UK market. Just do not mistake “interesting” for “easy”.