Fund cites AI competition and seat-based model risks as it exits $9.34 billion CRM provider HubSpot in Q1 2026.
TimesSquare Capital’s U.S. Mid Cap Growth Strategy sold its entire stake in HubSpot (HUBS) during Q1 2026, citing concerns over AI-driven disruption and challenges to the company’s seat-based pricing model. HubSpot, a $9.34 billion cloud-based CRM platform, closed at $182.51 on June 30, 2026, down 43% from the fund’s entry point.
The stock has underperformed sharply, posting a -17.95% one-month return and a -66.57% decline over the past 52 weeks. Hedge fund ownership also fell, with 46 portfolios holding HUBS at quarter-end, down from 56 in the prior quarter.
TimesSquare’s letter emphasized a preference for IT providers with durable competitive advantages, signaling skepticism about HubSpot’s long-term positioning amid evolving AI adoption in enterprise software.