JFrog Ltd

JFrog Ltd. (FROG) has demonstrated strong performance, being a top contributor to the Fund. The company provides a software supply-chain platform that helps manage, build, and secure the software delivery lifecycle. Despite concerns about AI's impact on the software industry, we believe JFrog's business model has significant competitive moats that make it defensible. Furthermore, we anticipate that JFrog will benefit from AI advancements, as the increase in code generation will lead to more dependencies and artifacts, positioning JFrog as crucial in managing these complexities. Recent quarterly earnings and revenue exceeded consensus estimates, and management raised earnings guidance for 2026, indicating robust business strength.

JFrog Ltd. (FROG) has demonstrated strong performance, being a top contributor to the Fund. The company provides a software supply-chain platform that helps manage, build, and secure the software delivery lifecycle. Despite concerns about AI's impact on the software industry, we believe JFrog's business model has significant competitive moats that make it defensible. In fact, we anticipate that JFrog will benefit from AI, as the acceleration of code generation increases the complexity of software dependencies, where JFrog plays a crucial role. Recent quarterly earnings and revenue exceeded consensus estimates, and management raised earnings guidance for 2026, indicating robust business strength.

JFrog Ltd. (FROG) has shown resilience and strength in its business model, particularly as it reported quarterly earnings and revenue that exceeded consensus estimates, with management raising earnings guidance for 2026. The company provides a software supply-chain platform that is crucial as AI accelerates code generation, increasing the complexity of software delivery. The manager believes there are moats around JFrog’s business model, making it defensible, and anticipates that JFrog will benefit from the growing demand driven by AI, particularly as cloud revenue rose 50% year over year in the first quarter due to AI coding agents.

JFrog Ltd. (FROG) provides a software supply-chain platform that helps companies manage, build, and secure their software delivery lifecycle. Despite a broader selloff in software stocks, we believe JFrog has strong competitive moats that make its business model defensible. The company is well-positioned to benefit from AI advancements, as increased code generation leads to more dependencies and artifacts in the development pipeline, which JFrog can govern effectively. Recent quarterly earnings exceeded consensus estimates, and management raised earnings guidance for 2026, indicating strong business momentum.

JFrog, a developer of software supply chain and DevOps platform solutions, gained 94% as cloud revenue grew more than 50% and now accounts for over half of total sales. This strong growth in cloud revenue highlights JFrog's critical role in the evolving IT landscape, particularly as demand for efficient software solutions continues to rise. The company's performance reflects its ability to capture significant market share in a rapidly expanding sector driven by AI infrastructure demand.

We ended our investment in JFrog, the market leader in continuous software release management (CSRM), after a strong performance in 2025. While shares performed strongly due to solid execution and increasing demand for integrated solutions, we exited the position as valuation concerns and a more challenging forward outlook emerged. Evolving competitive risks from emerging AI-native code security tools further reduced our conviction in the stock's future potential.

JFrog Ltd. (FROG) has demonstrated strong performance, with quarterly earnings and revenue exceeding consensus estimates, and management raising earnings guidance for 2026. The company provides a software-supply-chain platform that is crucial in managing the software delivery lifecycle. We believe JFrog's business model has significant competitive moats that make it defensible against AI disruption. In fact, as AI accelerates code generation, JFrog is positioned to benefit from the increased complexity in software development, playing a vital role in governing these challenges.

We added JFrog to our portfolio in Q3 due to its strong growth prospects in the technology sector. The company is well-positioned within the software and AI infrastructure markets, which are expected to see significant demand. We believe JFrog's offerings provide a competitive advantage, contributing to its moat in the industry. Our analysis indicates that JFrog is trading at attractive valuations, making it a compelling addition to our holdings.

We added JFrog to our portfolio in Q3 due to its strong growth prospects and attractive valuation. The company operates in the technology sector, which we are overweight, and is positioned well within the software and AI infrastructure markets. JFrog's business model and market position provide it with a competitive moat, making it a compelling investment opportunity as we continue to seek high-quality companies with specific growth drivers.

We added to our position in February with the view that the wider creation or adoption of GenAI applications for businesses would generate greater activity volumes for JFrog. That outlook was supported by the company’s subsequent report. Revenues, earnings, and forward guidance were all higher than anticipated as JFrog closed several multi-million-dollar deals along with higher rates of mid and smaller sized contracts. After that report, we met with JFrog’s management and discussed its initial successes cross selling additional security services. Thus, when its price retreated in March, we bought additional shares in JFrog.