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Seeking the Growth Potential and Stability of Large Caps

Voya Large-Cap Growth Fund Quarterly Commentary - 2Q25

Key Takeaways

Equity markets rebounded in the second quarter after April’s post-Liberation Day volatility, ending above the February peak. Growth outperformed value, driven by strength in technology and communication services, while energy and health care lagged. Easing inflation, selective rate cuts, and increased demand for safe-haven assets highlighted cross-asset dynamics. 

For the quarter, the Fund outperformed its benchmark, the Russell 1000 Growth Index (the Index), on a net asset value (NAV) basis due to favorable stock selection. 

As we enter the second half, investors face ongoing geopolitical risks and shifting monetary policy. Expanding leadership beyond mega-cap stocks is creating new opportunities, especially in defensive sectors. We remain focused on refining strategies to align with evolving conditions amid persistent uncertainty and inflationary pressures.

Actively managed large cap growth strategy that relies on fundamental research and analysis to identify companies exhibiting superior capital investment and core profitability with attractive risk-reward profiles.

Portfolio review

In the second quarter of 2025, U.S. equities rebounded significantly, with the S&P 500 increasing by 10.94% and the Nasdaq Composite rising by 17.75%. The technology and communication services sectors performed the best, while health care and energy sectors lagged, reflecting a mixed but generally positive market environment. Large-cap stocks outperformed small-cap stocks, and growth stocks beat value stocks.

The technology sector surged in 2Q25, driven by artificial intelligence (AI) growth as hyperscalers increased capital expenditure and improved ways to profit from their AI investments. Positive earnings from the Magnificent 7 stocks further boosted performance. The communication services sector also saw strong gains, benefiting from AI advancements and robust earnings. Conversely, policy and regulatory uncertainty weighed on the health care sector, affecting managed care and pharma companies. Weak oil prices and global growth concerns hampered energy companies, leading to their underperformance relative to the broader market. For the quarter, the Strategy outperformed its benchmark, the Russell 1000 Growth Index (the Index), on a NAV basis due to favorable stock selection. The outperformance can mainly be attributed to stock selection within information technology, communication services and industrials sectors. Alternatively negative stock selection within health care, consumer discretionary and financials sectors detracted from performance.

Key contributors to performance included Apple Inc., Axon Enterprise Inc. and Broadcom Inc. 

An underweight position in Apple Inc. (AAPL) contributed as a lack of artificial intelligence (AI) innovation as well as continued tariff concerns weighed on the stock. 

An overweight position in Axon Enterprise Inc. (AXON) contributed to performance. The company reported strong 1Q25 results with a favorable outlook boosted by new product launches and partnerships. 

An overweight position in Broadcom Inc. (AVGO) contributed as demand for AI semiconductors remained strong, supported by their projects with major cloud clients. 

Key detractors from performance were UnitedHealth Group Inc., Kenvue, Inc. and Vertex Pharmaceuticals Inc. 

Our position in UnitedHealth Group Inc. (UNH) detracted from performance. The company reported earnings that came below expectations and faced regulatory scrutiny due to a Department of Justice (DOJ) probe into its Medicare Advantage business. 

Owning a position in Kenvue, Inc. (KVUE) detracted from performance this quarter. Shares declined due to softer shipment volumes from retailer destocking and ongoing tariff-related pressures. 

An overweight position in Vertex Pharmaceuticals, Inc. (VRTX) detracted as weaker international sales and challenges with a new drug launch weighed on the stock.

Current strategy and outlook

The U.S. economy demonstrated resilience despite continued inflationary pressures and a potential slowdown. The U.S. Federal Reserve kept the key borrowing rate between 4.25% and 4.50%, but signaled potential rate cuts by the end of 2025. However, Fed Chair Powell emphasized a data-dependent approach, with markets expecting rates to remain steady in July. The labor market remains stable with strong nonfarm payrolls, and inflation expectations have fallen, boosting consumer sentiment, but the impact of tariffs remains a risk. U.S. assets are attractive, with the U.S. dollar at its lowest since March 22, 2025. Attractive returns on equities and bonds, coupled with a resilient labor market and global economic leadership, continue to inspire investor confidence and market optimism.

Holdings detail

Companies mentioned in this report—percentage of Strategy investments, as of 06/30/25: Apple Inc. 8.02%, Axon Enterprise Inc. 1.02%, Broadcom Inc. 4.88%, UnitedHealth Group Inc. 0.00%, Kenvue, Inc. 0.45% and Vertex Pharmaceuticals, Inc. 1.20%; 0% indicates that the security is no longer in the portfolio. Portfolio holdings are subject to daily change.

Related Resources

Voya Large-Cap Growth Fund Fact Sheet

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The Russell 1000 Growth Index is an unmanaged index that measures the performance of the 1000 largest companies in the Russell 3000 Index with higher price-to-book ratios and higher forecasted growth values.Index returns do not reflect fees, brokerage commissions, taxes or other expenses of investing. Investors cannot invest directly in an index.

All investing involves risks of fluctuating prices and the uncertainties of rates of return and yield inherent in investing. You could lose money on your investment and any of the following risks, among others, could affect investment performance. The following principal risks are presented in alphabetical order which does not imply order of importance or likelihood: Company; Currency; Derivative Instruments; Environmental, Social, and Governance (Equity); Foreign (Non-U.S.) Investments; Growth Investing; Investment Model; Issuer Non-Diversification; Liquidity; Market; Market Capitalization; Market Disruption and Geopolitical; Other Investment Companies; Real Estate Companies and Real Estate Investment Trusts; Securities Lending. Investors should consult the Fund’s Prospectus and Statement of Additional Information for a more detailed discussion of the Fund’s risks.

The strategy is available as a mutual fund or variable portfolio. The mutual fund may be available to you as part of your employer sponsored retirement plan. There may be additional plan level fees resulting in personal performance that varies from stated performance. Please call your benefits office for more information.Variable annuities and group annuities are long-term investments designed for retirement purposes. If withdrawals are taken prior to age 59½, an IRS 10% premature distribution penalty tax may apply. Money taken from the annuity will be taxed as ordinary income in the year the money is distributed. An annuity does not provide any additional tax deferral benefit, as tax deferral is provided by the plan. Annuities may be subject to additional fees and expenses to which other tax-qualified funding vehicles may not be subject. However, an annuity does provide other features and benefits, such as lifetime income payments and death benefits, which may be valuable to you. All guarantees are based on the financial strength and claims paying ability of the issuing insurance company, who is solely responsible for all obligations under its policies. Insurance products, annuities and funding agreements issued by Voya Retirement Insurance and Annuity Company (“VRIAC”), One Orange Way, Windsor, CT 06095, which is solely responsible for meeting its obligations. Plan administrative services provided by VRIAC or Voya Institutional Plan Services, LLC (“VIPS”). Securities distributed by or offered through Voya Financial Partners, LLC (“VFP”) (member SIPC) or other broker-dealers with which it has a selling agreement. Only Voya Retirement Insurance and Annuity Company is admitted and can issue products in the state of New York.

This commentary has been prepared by Voya Investment Management for informational purposes. Nothing contained herein should be construed as (i) an offer to sell or solicitation of an offer to buy any security or (ii) a recommendation as to the advisability of investing in, purchasing or selling any security. Any opinions expressed herein reflect our judgment and are subject to change. Certain of the statements contained herein are statements of future expectations and other forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results, performance or events may differ materially from those in such statements due to, without limitation, (1) general economic conditions, (2) performance of financial markets, (3) interest rate levels, (4) increasing levels of loan defaults (5) changes in laws and regulations and (6) changes in the policies of governments and/or regulatory authorities.

The opinions, views and information expressed in this commentary regarding holdings are subject to change without notice. The information provided regarding holdings is not a recommendation to buy or sell any security. Portfolio holdings are fluid and are subject to daily change based on market conditions and other factors. Past Performance does not guarantee future results  

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