The Pouch Rivals in an Uneven MarketThin moat

Philip Morris International (PM) — moat facet

ZYN still holds about two-thirds of American pouches, but its offtake went flat in a growing market and PMI blames an uneven field.

Nicotine pouches are where PMI faces real competition. ZYN held around two-thirds value share of American pouches in 20251, but in 2026 its offtake was flat to slightly growing in a growing category, which PMI attributed to an "uneven competitive landscape"2. When the leader is flat in a growing market, the rivals are taking the growth.

ZYN shipments, 2026 year on year (%)-23.5Q1 2026+1.8Q2 2026-11.2H1 2026PMI Q1 and Q2 2026 results releases
Destocking, then a small recovery.

PMI's own shipments show the pressure. ZYN shipments in the first half of 2026 fell 11.2% to 5.2 billion pouches3, partly because distributors cut stock after the 2025 surge. PMI answered with a lower price per pouch, which is examined on the ZYN ULTRA page.

PMI's advantage over these rivals is regulatory rather than technical. A pouch is simple to make, and there is no device to lock a user in. What ZYN has that rivals do not is FDA authorisation of 20 varieties from January 20254 and, from 30 June 2026, the modified risk orders PMI called "the first and only for a nicotine pouch product"5.

The phrase "uneven" is PMI's complaint that its rivals do not all carry the same regulatory burden. Whether that is fair or not, a moat built on authorisation is worth only as much as the enforcement that keeps unauthorised products away.

This is the thinnest of PMI's competitive positions. The American segment's adjusted gross margin is the measure, 65.4% in the second quarter of 2026, down 6.0 points6; a margin still falling after the new can sizes have settled would say ZYN is buying volume at the cost of its pricing power.

Moat trajectory: Narrowing

Offtake flat in a growing category; margin down 6 points.

The number that tests this moat
Reported
U.S. segment adjusted gross margin, latest quarter
65.4%, -6.0 points (Q2 2026)

The price of defending pouch share; still falling after the new can sizes settle would mean ZYN is losing pricing power.

Source: PMI Q2 2026 results release ↗
References
  1. ReportedZYN held around two-thirds value share of American pouches in 2025, but in 2026 its offtake was flat to slightly growing in a growing category, which PMI attributed to an "uneven competitive landscape".
    Philip Morris International fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99.1 - smoke-free share of revenue and gross profit, 2026 guidance and 2026-2028 targets. — FY2025 · publ. 6 February 2026 · source ↗
  2. ReportedZYN held around two-thirds value share of American pouches in 2025, but in 2026 its offtake was flat to slightly growing in a growing category, which PMI attributed to an "uneven competitive landscape".
    Philip Morris International second-quarter 2026 results release, Form 8-K exhibit 99.1 - volumes, shares, ZYN and 2026 guidance - shipment volumes, market shares, IQOS, ZYN and Japan. — Q2 2026 · publ. 22 July 2026 · source ↗
  3. ReportedZYN shipments in the first half of 2026 fell 11.2% to 5.2 billion pouches, partly because distributors cut stock after the 2025 surge.
    Philip Morris International second-quarter 2026 results release, Form 8-K exhibit 99.1 - volumes, shares, ZYN and 2026 guidance - shipment volumes, market shares, IQOS, ZYN and Japan. — Q2 2026 · publ. 22 July 2026 · source ↗
  4. ReportedWhat ZYN has that rivals do not is FDA authorisation of 20 varieties from January 2025 and, from 30 June 2026, the modified risk orders PMI called "the first and only for a nicotine pouch product".
    Philip Morris International Form 10-Q for the quarter ended 30 June 2026 - segment results, the balance sheet, FDA authorisations and shares outstanding. — Q2 2026 · publ. 24 July 2026 · source ↗
  5. ReportedWhat ZYN has that rivals do not is FDA authorisation of 20 varieties from January 2025 and, from 30 June 2026, the modified risk orders PMI called "the first and only for a nicotine pouch product".
    Philip Morris International second-quarter 2026 results release, Form 8-K exhibit 99.1 - volumes, shares, ZYN and 2026 guidance - shipment volumes, market shares, IQOS, ZYN and Japan. — Q2 2026 · publ. 22 July 2026 · source ↗
  6. ReportedThe American segment's adjusted gross margin is the measure, 65.4% in the second quarter of 2026, down 6.0 points; a margin still falling after the new can sizes have settled would say ZYN is buying volume at the cost of its pricing power.
    Philip Morris International second-quarter 2026 results release, Form 8-K exhibit 99.1 - volumes, shares, ZYN and 2026 guidance - shipment volumes, market shares, IQOS, ZYN and Japan. — Q2 2026 · publ. 22 July 2026 · source ↗
Sources
Generated September 26, 2026