As of Q3 2025, Pat Dorsey’s Dorsey Asset Management portfolio demonstrates continued refinement of his moat-focused investment approach. The concentrated portfolio totals $1.11 billion across 9 positions (down from 10), reflecting Dorsey’s philosophy of investing in high-conviction ideas with sustainable competitive advantages. This quarter featured significant portfolio rebalancing, with the complete elimination of software holdings, dramatic increases in semiconductor technology, a major reduction in big tech platforms, and a new pharmaceutical royalty investment.

Wix.com (WIX): Completely eliminated after last quarter’s 54% reduction. The website builder position has been fully exited, confirming concerns about the company’s competitive position against larger technology platforms.

Semrush Holdings (SEMR): Fully sold out from a minor 1.85% position. The digital marketing platform’s exit suggests Dorsey’s reassessment of its competitive moat sustainability in the evolving SEO and marketing analytics landscape.

Technology (META, GOOG, ASML): Technology concentration narrowed with software eliminated and focus shifted toward semiconductor technology dominance. ASML’s near-monopoly in EUV lithography represents Dorsey’s highest-conviction tech bet, while big platform positions were significantly reduced despite their network effects.

Healthcare & Life Sciences (DHR, RPRX, ENOV): Healthcare allocation evolved with the addition of Royalty Pharma’s pharmaceutical royalty model alongside Danaher’s diagnostic tools and Enovis’s orthopedic devices. This sector emphasizes mission-critical products, regulatory barriers, and predictable revenue streams with high switching costs.

Consumer & Travel (AZO, BKNG, AER): Core positions in location-based advantages and network effects continue, though with some trimming across all three holdings. AutoZone’s convenient locations, Booking’s platform network effects, and AerCap’s capital-intensive aircraft leasing all maintain competitive barriers.

Shift Toward Technology Monopolies: The dramatic ASML accumulation alongside big tech platform reductions suggests Dorsey increasingly values absolute technological dominance over network effect-based advantages. ASML’s monopoly in critical semiconductor equipment represents an unassailable competitive position.

Exit from Software and Digital Services: The complete elimination of Wix and Semrush marks a clear retreat from software investments where competitive advantages may be eroding. This suggests Dorsey sees lower barriers to entry and greater disruption risk in these sectors.

Healthcare Diversification with Asset-Light Models: The addition of Royalty Pharma introduces pharmaceutical exposure through a capital-efficient royalty model, complementing the medical technology and life sciences positions. This approach provides healthcare upside without operational complexity.

Active Portfolio Management and Rebalancing: The multiple position trims, complete eliminations, and new addition demonstrate active portfolio management based on evolving competitive dynamics and valuations rather than buy-and-hold passivity.

Pat Dorsey’s Q3 2025 portfolio reveals significant strategic repositioning within his moat-focused investment framework. The most dramatic change is the intensified ASML conviction, now the #2 holding after two consecutive quarters of aggressive accumulation, representing Dorsey’s belief in technological monopolies as the strongest form of competitive moat.

The portfolio’s evolution shows increasing selectivity, with complete exits from software holdings Wix and Semrush, and major reductions in big tech platforms Google and Meta. These moves suggest concerns about competitive moat durability in software and platform businesses facing AI disruption and intensifying competition.

The addition of Royalty Pharma introduces pharmaceutical exposure through an asset-light royalty model, diversifying healthcare holdings beyond traditional medical technology. Meanwhile, Danaher maintains its position as the largest holding despite trimming, underscoring confidence in mission-critical life sciences tools.

With just 9 positions totaling $1.11 billion, Dorsey Asset Management continues to exemplify concentrated, high-conviction investing. The Q3 changes reflect active management and willingness to significantly reposition when competitive dynamics shift, while maintaining unwavering focus on businesses with durable competitive advantages. The portfolio’s evolution demonstrates that even within a moat framework, investors must continuously reassess which types of competitive advantages will prove most durable in changing technological and competitive landscapes.