Benefiting from a rallying stock market and strategic venture capital investments—including a stake in SpaceX—Harvard University’s endowment fund delivered a 27.1% return for the year ending in June, pushing its total assets to a record $68 billion. However, this investment windfall is not enough to fully offset the impact of research funding cuts and tax increases imposed during the Trump administration. The university has also cautioned that such high annual returns should not be expected to repeat every year.
On Thursday, Harvard announced that its endowment assets grew by approximately $11 billion for the fiscal year ending June 30. This marks the fund’s best annual performance since 2021 and significantly outperforms the median return of roughly 19% (before fees) seen among major U.S. university endowments.
N.P. “Narv” Narvekar, CEO of Harvard Management Company—the entity responsible for managing the endowment—attributed this “outstanding” performance primarily to gains in venture capital, publicly traded stocks, and hedge funds. According to data compiled by Bloomberg, the Harvard endowment has achieved an annualized return of approximately 11% over the past decade.
Strong Returns from SpaceX, but Venture Capital Carries Risks
In recent years, Harvard has increased its allocation to private equity; this asset class now accounts for 46% of its portfolio, up from 34% five years ago. Within this, the share dedicated to venture capital and growth equity—investments focused on early-stage, rapidly growing companies—has risen to 31%, compared to 24% a year earlier.
While these investments had weighed on performance in previous years, they rebounded this year alongside a surge in the valuations of private technology companies. As of June 30, Harvard held more than $2 billion worth of SpaceX stock, which served as a key driver of its investment gains.
During the fiscal year, Harvard also added 732,022 American Depositary Receipts (ADRs) of TSMC to its portfolio, bringing the value of its stake to $350 million and making it the fund’s second-largest holding. Because 13F regulatory filings do not disclose the cost basis of these transactions, the exact contribution of the TSMC position to the fund’s overall performance cannot be determined.
However, this heavy concentration in venture capital also means that future returns will be increasingly sensitive to the valuations of technology companies. Philip Casey, founder of Institutional LPs—a firm that provides services to university endowment funds—noted that Harvard’s aggressive risk-taking strategy this year has paid off handsomely. However, he cautioned that the AI boom and a concentrated venture capital portfolio could become vulnerabilities, as the fortunes of such investments can shift rapidly.
Navaka similarly warned: “Periods of exceptionally high returns are sometimes followed by short-term performance that is low, or even negative.” He emphasized that this is not an attempt to forecast the market, but rather a historical pattern that must be considered when assessing portfolio risk. He also reaffirmed his intention to retire.
High Investment Gains Do Not Translate to Discretionary Spending Power
Harvard recorded a surplus of approximately $100 million for the fiscal year, reversing a loss of similar magnitude from the previous year. The university stated, however, that without measures such as a hiring freeze, attrition, and organizational restructuring to reduce headcount, the annual budget would have remained in the red. Total salary expenditures for the year decreased by $104 million, a reduction of 3.8%.
The Trump administration, citing concerns such as antisemitism on campus, sought to freeze billions of dollars in federal research funding and impose restrictions on international students. Harvard challenged these actions in court and has secured favorable rulings in two cases; however, appeals are ongoing, and the government continues to initiate new investigations.
While approximately 40% of Harvard’s operating revenue is derived from its endowment, many donations are restricted to specific purposes, meaning that investment gains cannot all be used at the university’s discretion. The administration noted that strong investment returns do not immediately translate into flexible, spendable capital, nor can investment performance alone resolve recurring structural budget deficits.
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