Compare moats
Up to three covered companies, band by band. Every call is a curated editorial judgment, never a disclosed figure — and every band carries its cited basis.
| Adobe | Digital Realty Trust | Pegatron | |
|---|---|---|---|
| Moat rating | narrow The FY2025 10-K's own Competition section says the markets for Adobe's solutions are characterized by 'limited barriers to entry, short product lifecycles, customer price sensitivity ... and the frequent entry of new solutions or competitors', and Item 1A adds that Adobe 'face[s] increasing competition from companies offering generative and agentic AI solutions, including but not limited to prompt-based and multi-modal creation and editing, document productivity and understanding' - the two categories that carry the Digital Media segment. That disclosed contestability caps the moat below wide, while the same filing's industry-standard app designations and 89% consolidated gross margin keep it well above none. | narrow The FY2025 10-K's own competitive record cuts both ways. Item 1 says a "high-quality, highly interconnected global portfolio such as ours could not be easily replicated today on a cost-competitive basis," yet Item 1A concedes that competitors have "significantly greater financial, marketing and other resources and more ready access to capital" and that as rivals keep developing space, "rental rates may be reduced or we may face delays in leasing." A durable advantage that its own filing says new supply can price against is bounded, not unassailable. | none The 2025 annual report (English version filed with TWSE on 2026-05-08) shows scale without a protected position. Consolidated revenue was NT$1,117.2 billion, down from NT$1,125.3 billion, at a gross margin of 3.80%, while DigiTimes put the top 20 EMS/ODM vendors' combined 2025 revenue up 23.4% in US dollars (cnyes, 2026-02-02). One coded customer ("A Company") took 57.34% of 2025 net sales (59.34% in 2024) and a second ("B Company") 9.14%, and the report lists "Intense Competition and Pricing Pressure" and "Customer Concentration and Product Cycle Risks" among its disadvantages. A DigiTimes analysis of the 2024 top 20 (2025-01-27) found Pegatron's net-profit rank six places below its revenue rank, and its net margin at 1.5% or less since 2018 with no clear sign of improvement. A large assembler whose own report and independent data describe no protected return: no moat is claimable. |
| Moat type | switching costs The 10-K frames Adobe's differentiation as an integrated ecosystem the customer's work lives inside: Creative Cloud Pro subscribers get 'cloud storage to easily sync, access, collaborate and share their work, files and assets', the AI platform offers a choice of models 'without the friction of switching between workflows and platforms', and on the enterprise side 'Our competitive differentiation comes from the increased value we provide customers by integrating the Adobe Experience Platform with our comprehensive set of solutions'. 96% of FY2025 revenue is subscription, with $22.52B of remaining performance obligations, up 13% year over year. | network effects Item 1 attributes the hard-to-replicate part of the portfolio to connectivity rather than to real estate: "the network density, interconnection infrastructure and connectivity-centric customers in certain of our data centers have led to the organic formation of densely connected data communities that are difficult for competitors to replicate." That community sits on over 232,000 cross connects in over 55 metros, so each network and cloud that lands makes the same building worth more to the next tenant. | none The report's listed competitive advantages are operating capabilities that rivals also have: 4,997 R&D engineers, manufacturing sites in China, the USA, Mexico, the Czech Republic, Indonesia, Vietnam, Malaysia, India and Taiwan, a diversified product and customer base, global logistics, an experienced management team, and vertical integration across materials from metal stamping and plastic injection to light-metal technologies. R&D was 1.44% of 2025 revenue, and the supplier table notes that "partial major materials are purchased by major customers and resell to the Company for manufacturing and system assembly". Its seat in Apple's supply chain has proved contestable: DigiTimes (via Global SMT, 2025-07-24) says Chinese vendors, "most notably Luxshare, have gained ground through acquisitions and key contract wins, including major entries into Apple's supply chain via asset purchases from Merry Electronics, Lite-On, Wistron, and Pegatron". DigiTimes' analyst wrote (2025-01-27) that Pegatron, Wistron, Compal and Inventec all began as computer-system makers whose component businesses and degree of vertical integration can hardly match those of Chinese makers. |
| Leadership | clear leader In the segment that is 74% of FY2025 revenue ($17.65B of $23.77B) the 10-K asserts leadership outright: Illustrator 'our industry-standard vector graphics app', After Effects 'our industry-standard motion graphics and visual effects app', Acrobat 'a leading document productivity app', and 'category and brand leadership' in the Competition section. The claim does not extend to the whole company - the same section says the marketing solutions 'face broad competition from large, established enterprise software and cloud companies'. | co leader Item 1 claims the title of "the largest global provider of cloud- and carrier-neutral data center, colocation and interconnection solutions," but the Competition section names Equinix and NTT as operators of properties "similar to ours in some of the same metropolitan areas," plus Global Switch and regional operators abroad — a shared top tier on the company's own telling, not a solitary one. | behind DigiTimes' July 2025 ranking (via Global SMT, 2025-07-24) says "Pegatron had long held the second spot" until Quanta overtook it in 1H24, that "Luxshare displaced Pegatron to become the No. 3 EMS/ODM vendor in the second half of 2024", and ranks it fourth in 1H25 after Wistron's surge. DigiTimes' 2025 full-year ranking (cnyes, 2026-02-02) lists the top five in order as Foxconn, Wistron, Quanta, Luxshare and Pegatron. In notebooks, market research cited in the annual report puts Pegatron fifth of the five Taiwanese ODMs it lists, at 9.1 million units or 4.96% of worldwide volume. Its 2025 revenue fell 0.73% in NT dollars (annual report) while DigiTimes put Foxconn's up 22.4% and Quanta's up 55.6% in US dollars (cnyes), and 1H26 revenue fell again, by 3.9% to NT$518,553 million (2Q26 business review): losing ground to peers, so behind rather than at parity. |
| Pricing power | strong Per the same 10-K's segment table, Digital Media earned a 95% gross profit margin in FY2025 (96% FY2024, 95% FY2023) and consolidated gross margin held at 88%/89%/89% across FY2023-FY2025 while revenue grew 11% to $23.77B. 96% of revenue is subscription and remaining performance obligations reached $22.52B, up 13%. Item 1A's warning of 'downward pressure on pricing and gross margins' has not shown up in realized margin. | strong FY2025 renewals signed re-priced upward in every bucket — +27.0% on greater-than-1 MW space ($146 to $186 per square foot), +4.6% on 0-1 MW ($268 to $280) and +43.0% on other ($49 to $71) — and MD&A expects average aggregate rental rates on 2026 renewals to be positive against the rates currently paid for the same space "on a GAAP basis and on a cash basis." On costs, the filing says utilities expense "is our largest expense category" and that "the vast majority of the expense is passed directly through to our customers," which it credits with significantly mitigating exposure to power-cost increases rather than removing it. The cap: Item 1A warns competitor development could still force rates down. | weak The annual report gives a 2025 gross margin of 3.80%, with gross profit down 7.67% on net sales down 0.73%; the 2Q26 business review shows 1H26 gross margin of 4.4% against 3.4% a year earlier. Among its disadvantages the report says "increasing competition may place pressure on pricing and profitability". DigiTimes (2025-01-27) counted Pegatron among Taiwanese makers whose net margin had been 1.5% or less since 2018, with no clear sign of improvement. |
| Summary | Adobe's durable advantage is the cost of leaving rather than any disclosed market share. Its FY2025 10-K calls Illustrator 'our industry-standard vector graphics app' and After Effects 'our industry-standard motion graphics and visual effects app', describes Acrobat as 'a leading document productivity app', and sells them as one subscription ecosystem where assets, workflows and collaboration are cloud-resident. The economics follow: Digital Media earned a 95% gross profit margin on $17.65B of FY2025 revenue, 74% of the company. The same filing is unusually candid about the limits, calling its markets characterized by 'limited barriers to entry' and warning that competition will 'continue to intensify' with named generative and agentic AI entrants in both creation and document productivity - so the moat reads narrow rather than wide, held today by realized pricing and switching costs rather than by structural protection. | Digital Realty rents space, power and connectivity rather than compute: at 2025 year-end its portfolio held 310 data centers and roughly 57.6 million rentable square feet across more than 55 metros in over 30 countries, about 84.7% leased, serving more than 5,000 customers. Two different businesses sit inside that footprint. The greater-than-1 MW wholesale side is a capital-and-power race — 769 MW of projects underway with 64% pre-leased, and land that "could accommodate over 3,500 megawatts of additional data center capacity" — where the 10-K names Equinix, NTT, Global Switch and "various private operators" as rivals and warns that added supply can push rents down. The colocation and interconnection side is the defended half: over 232,000 cross connects and the "densely connected data communities" Item 1 says competitors cannot easily replicate, reinforced by contracts the filing describes as generally running 5-10+ years on large deployments and by improvements "installed at our customers' expense." FY2025 leasing supports that read — renewals signed re-priced +27.0% on greater-than-1 MW space and +4.6% on 0-1 MW — while customer concentration is the offsetting exposure, with the largest customer at roughly 11.7% of annualized recurring revenue. | Pegatron is a Taiwanese EMS/ODM whose 2025 annual report describes three segments: computing (notebooks, desktops, motherboards, servers), communication (cable modems, set-top boxes, smartphones, switches, routers, gateways, 5G O-RAN) and consumer electronics (tablets, game consoles, wearables, smart home devices, automotive electronics). Communication remained the largest segment in 2025, and one coded customer took 57.34% of net sales. Revenue was NT$1,117.2 billion at a 3.80% gross margin. Servers are the growth line: the report cites large-scale shipments of NVIDIA GB300 NVL72 and HGX B300 systems in 2025, and the 2Q26 business review (2026-08-12) says computing revenue rose 84% year on year, "driven mostly by greater shipment from Server business", taking computing to 23% of revenue while communication fell to 52% after a double-digit decline. Independent rankings show it losing ground: DigiTimes says Pegatron "had long held the second spot" among EMS/ODM vendors by revenue until Quanta passed it in 1H24, and its 2025 full-year ranking puts it fifth behind Foxconn, Wistron, Quanta and Luxshare, with 2026 AI server and rack orders expected to concentrate in Foxconn, Wistron and Quanta. Gross margin improved to 4.4% in 1H26 from 3.4% a year earlier, still thin. A large, diversified assembler without a protected position. |
| Chain position | An AI-application layer company that both builds its own commercially safe Firefly foundation models and licenses 'an extensive ecosystem of third-party models', distributing generative AI into creative, document and marketing workflows. | Landlord to the AI stack — sells the space, power and interconnection that cloud, network and enterprise tenants run compute in (Oracle, IBM, Meta Platforms, AT&T, Comcast and Lumen are among the customers named in Item 1), with roughly 2.9 GW of total in-place IT capacity. | Contract designer-manufacturer for brand customers in computing, communication and consumer electronics; America took 41.18% and Europe 38.79% of 2025 sales, and some major materials are bought by major customers and resold to Pegatron for assembly (annual report). |
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| Long-horizon vote | +0.24 at weight 0.20 · swarm neutral Editorial prior, not backtested. | +0.17 at weight 0.20 · swarm neutral Editorial prior, not backtested. | -0.20 at weight 0.20 · swarm bearish Editorial prior, not backtested. |