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“Wind power has gone from niche to mainstream. The wind sector now needs to progress further - to becoming a baseload energy source.”

Bert Nordberg
Chairman of the Board of Directors

Letter from the Chairman & the CEO

Continued leadership
A remarkable 2018, where both Vestas and the industry reached new milestones, has come to an end and we have entered a new year that could set the industry’s direction for the future. While Vestas continued to lead the industry on key parameters such as sales, profitability, and technology, the industry continued its transition towards more complex and market-based mechanisms. In the coming years, we must build on these achievements and adapt to the new reality in order to realise our vision as the Global Leader in Sustainable Energy Solutions and help create a world powered by sustainable energy. 

Together with our customers and partners, we are leading the way in transforming renewable energy into mainstream energy, hereby removing hundreds of millions of tonnes of CO2 from our atmosphere, and helping the world meet its growing energy needs sustainably. 

The 100 GW milestone
2018, was a year of many highlights. We broke our order record again; we entered into new markets; we introduced new technology solutions; expanded our footprint and ramped up manufacturing; and we took a leap within digitalisation with the acquisition of Utopus Insights. To us, the biggest highlight in 2018, which we are very proud of, was that we became the first company to install 100 GW of wind turbines when we completed the 250 MW Arbor Hill project in the USA for MidAmerican Energy Company. Vestas pioneered wind energy 40 years ago and to install 101 GW in around 80 countries across six continents is something we should be proud of. The 100 GW has been made possible through our relentless commitment to design and deliver wind energy solutions all over the world. A commitment that everyone in Vestas has shown throughout the years. A well-deserved congratulation to everyone, past and present, who has helped Vestas reach this important milestone.  

Looking ahead
Today, wind energy has manifested itself as the cheapest source of electricity in many markets, which through increased efficiency has helped wind and solar energy reach 1,000 GW of installed capacity by 2018. This highlights the tremendous progress the industry has made in the last 40 years, but also why it is more important than ever that we continue to lead the industry. 

With more than 100 GW of installed wind turbines, Vestas has installed around 20 percent of all wind capacity in the world, but with the next 1,000 GW of wind and solar energy expected to be installed by 2023, we need to remain focused on executing our commitments and priorities in the short term. By doing so, we sustain and strengthen the foundation that enables us to develop the sustainable energy solutions our customers and stakeholders need in the future. 

From this foundation, we can strengthen our core within wind energy products, services, and solutions that combine wind with other renewable technologies; build on our industry-leading wind and weather data to introduce new digital solutions; leverage our unique global reach, scope and size to enter and win new growth markets; as well as understand and work with new and existing customers to deliver best-in-class sustainable energy solutions. 

The 100 GW milestone proves that we have the innovative spirit, the persistence, the boldness and the aspiration to solve big challenges, enabling us to be the global leader in sustainable energy today and in the future. 

Shareholder value is a top priority
Our financial performance in 2018, allowed us to continue returning value to our shareholders, as demonstrated by our dividend pay-out and completion of two share buy-back programmes. The ambition is to continue to provide value to our shareholders by balancing our capital resources for investments into innovating and industry leading sustainable energy solutions and as well returning excess cash through a combination of dividends and share buy-back programmes. 

On that note, we want to thank all our stakeholders for your hard work and support in 2018, and we look forward to continuing our journey together.

Bert Nordberg, Chairman of the Board of Directors

Anders Erik Runevad, Group President & CEO

Quick links to annual report 2018 (pdf)

Corporate strategy

The global energy market is primarily faced with two major challenges: Meeting the growing global energy needs in a way that is sustainable while at the same time addressing climate change by decarbonizing existing energy systems. Consequently, estimates continue to show that renewable energy will dominate future power generation. 

Creating the energy system for future generations  
By developing wind power to become a mainstream and cost-efficient source of energy, Vestas has been and continues to be a cornerstone in making the world’s energy mix more sustainable. Vestas wants to take an active part in driving the necessary change of the existing energy system and create a sustainable energy system for future generations.  

Vestas’ vision
Vestas remains committed to its vision: to be the Global Leader in Sustainable Energy Solutions, which, among other things, entails leading the wind power industry in terms of volume, revenue, and margins. 

This vision sets a clear purpose and direction for Vestas’ employees and fuels its ambition to lead the global energy transition. To reap the benefits of this transition, Vestas continues to consolidate and expand its strong position within all three business areas: Power solutions, Service, and Offshore, while investing in the solutions and commercial capabilities needed to meet future market demand. 

Mid-term objectives – Global leader in wind solutions
Technologies, policies, and markets are maturing and demand from customers are adapting to more market-based mechanisms. To reflect this reality, Vestas has updated its mid-term objectives of being Global leader in wind power plant solutions and Global leader in wind service solutions to include:

  • Leading in innovating products, services, and digital solutions that deliver the lowest cost of energy, increase the penetration of renewables, and help customers fully optimise value from renewable power solutions. 
  • Being the preferred solutions provider and partner to the customers. 
  • Leading by market share in established markets and competing for leadership in emerging markets. 
  • Leading in profitability to enable us to reinvest into Vestas’ future innovation and competitiveness.

Read more (pdf)


Outlook 2019
Revenue is expected to range between EUR 10.75bn and 12.25bn, including service revenue, which is expected to grow by approx. 10 percent. Vestas expects to achieve an EBIT margin before special items of 8-10 percent with a service EBIT margin of approx. 24 percent.

Total investments* are expected to amount to approx. EUR 700m in 2019.

It should be emphasised that Vestas’ accounting policies only allow the recognition of revenue when the control has passed to the customer, either at a point in time or over time. Disruptions in production and challenges in relation to shipment of wind turbines and installation hereof, for example bad weather, lack of grid connections, and similar matters, may thus cause delays that could affect Vestas’ financial results for 2019. Further, movements in exchange rates from current levels may also impact Vestas’ financial results for 2019.

Outlook 2019 
EUR 10.75bn-12.25bn
EBIT margin before special items
Total Investments* 
 approx. EUR 700m
*Excl. any investments in marketable securities and short-term financial investments.

Long-term financial ambitions 
Vestas envisions market conditions, which in the long term will reflect wind power having achieved merchant levels in the vast majority of markets. The wind power industry is undergoing a transition towards a more mature, unsubsidised renewable energy industry. This transition leads to a highly competitive market, and will likely drive a further consolidation in the industry. Beyond the transition, a matured market for wind energy creates opportunities for Vestas to leverage and strengthen its leadership position.

Within this context, Vestas is able to present long-term financial ambitions that reflect its projection for market conditions and the presumed result of its strategy – including initiatives that are currently being undertaken.

In the coming years, revenue in the Service segment is expected to grow faster than the market with an EBIT margin of approx. 24 percent. Return on Capital Employed has replaced Return on Invested Capital.

Long-term financial ambitions
Grow faster than the market and be market  
 EBIT margin
At least 10 percent
 Free cash flow
Positive each year
Minimum 20 percent over the cycle

Read more (pdf)

Financial performance in 2018

Realised 2018 Guidance 2018 
EUR 10.1bn
EUR 10.0bn-10.5bn Revenue
9.5% 9.5-10.5% EBIT margin before special items
EUR 418m  
approx. EUR 400m  Free cash flow* 
EUR 603m
approx. EUR 600m Total investments*

* Excl. the acquisition of Utopus Insights, Inc., any investments in marketable securities, and short-term financial investments.

Activities in Power solutions

Highlights 2018
Europe, Middle
East and Africa
Asia Pacific
EUR 3,903m  EUR 3,354m EUR 1,208m
Order intake - firm and unconditional orders
6,271 MW  5,599 MW 2,344 MW
4,996 MW  4,128 MW 1,723 MW
Order backlog – firm and unconditional orders
6,038 MW  7,023 MW 2,585 MW
Installed wind turbines in
 10 countries  23 countries  6 countries

Read more (pdf)

Order intake and financial performance
Vestas achieved in 2018 yet another record-high order intake of 14,214 MW. This also resulted in an order backlog of 15,646 MW equivalent to EUR 11.9 bn. Activity levels increased, as more than 10,676 MW was produced and shipped, and 10,847 MW delivered to customers. 

Revenue from Power Solutions was EUR 8,465m in 2018 which was in line with 2017 where revenue was EUR 8,431m. EBIT before special items was EUR 754m, a 34 percent decrease compared to 2017. 

Crossing a milestone for a maturing industry

In late 2018, a new milestone was reached in Vestas’ 40-year journey as it achieved 100 GW of installed wind turbines. Since the inauguration of a V10-30 kW turbine in Denmark in 1979, Vestas has installed over 66,000 wind turbines in 80 countries across six continents and been a key part of taking wind energy from niche to mainstream. 

With the constant evolution of wind energy technology, output, and efficiency have increased to a level that has made wind energy the cheapest form of electricity in many markets. Consequently, the transition towards market-based solutions continues, and the complexity of sustainable energy solutions thus continues to increase as well. 

Connecting future and legacy
The ability to constantly lower the cost of energy continues to be of utmost importance. Vestas continues to develop new products and solutions to enhance the flexibility and agility to offer customers solutions that meet their market specific demand anywhere in the world. 

Going forward, this development will take a fully modular approach, which decouples the development of modules from the launch of new products and will revolve around key modules based on proven performance from Vestas’ legacy wind turbines. The benefits of a fully modular approach include increased ability to create customised solutions, ability to offer more variants with less components, increased standardisation to enable efficiency and scale, and lastly increases the opportunity to build supplier partnerships.

Activities in Service

Highlights 2018
Europe, Middle
East and Africa
Asia Pacific
EUR 541m
 EUR 956m EUR 172m
Share of region’s total revenue
12%  22% 12%
Under service
32,549 MW
 44,201 MW 9,594 MW
Order backlog – future expected
contractual revenue
EUR 4,426m  EUR 8,477m EUR 1,416m
Provides service in
 17 countries  39 countries  11 countries

Read more (pdf)


Order intake and financial performance
In 2018, Vestas’ service business continued to grow its activities with an increased profitability. In the year, revenue for the service business reached EUR 1,669m with an EBIT margin of 25.2 percent.

At the end of 2018, Vestas had service agreements in the order backlog with future expected contractual revenue of EUR 14.3bn, an increase of EUR 2.2bn compared to 2017.

Digital transformation
As the onshore wind power market becomes more market based, customers are becoming increasingly sophisticated in their focus on lifetime service costs and output optimisation. This means that the service market plays a vital role in the offering of sustainable energy solutions. 

Through its service business, Vestas is looking to offer customers digital solutions to deliver greater predictability, increased renewable energy production, more efficient operations, and better integration with the grid. In 2018, Vestas took an important step with the acquisition of Utopus Insights, Inc. (Utopus), a leading energy analytics and digital solution company.

Vestas has an unparalleled insight into a broad range of data covering performance of a wind turbine and its components, as well as wind and weather conditions. Combining this with Utopus’ unique competences within energy analytics and data science, Vestas can fully leverage its unmatched data repository.

Targets for the service business
Growing the service business continues to be a key part of Vestas’ corporate strategy as it provides a predictable and profitable supplement to the other business areas of the Group. 

The long-term ambition is to extend and fully leverage Vestas’ global leadership in wind turbine service solutions, growing the service business faster than the market while delivering stable, industry-leading margins.

Activities in Offshore

Highlights 2018  Global
EUR 1,112m
Order intake – firm and unconditional orders
3,180 MW
Order backlog - firm and unconditional orders 3,838 MW
Order backlog – conditional orders and preferred supplier agreements
1,700 MW
Total installations
 945 MW

Read more (pdf)

Read more at MHI Vestas Offshore Wind's website

Order intake and financial performance
The revenue for the offshore joint venture, MHI Vestas Offshore Wind A/S (MHI Vestas Offshore Wind), amounted to EUR 1.1bn in the calendar year 2018, which is in line with revenue in 2017. The net profit for the joint venture amounted to EUR 26m, which entails a contribution of EUR 13m in Vestas’ “Income from investments in joint ventures and associates”. 

The intake of firm orders reached 3,180 MW in 2018, compared to 702 MW in 2017. Consequently, the firm order backlog increased to 3,838 MW by the end of 2018.

Well positioned to benefit from future growth
2018 was a year where the offshore wind power industry solidified its position as an affordable part of the mainstream energy mix. Furthermore, Taiwan and the USA announced the winners for their first offshore projects in both markets, as they lead the expansion of offshore wind power outside the countries around the North Sea. 

MHI Vestas Offshore Wind has in 2018 secured a solid position to benefit from the strong growth that is expected in the next decade. Close to 2 GW of projects in the UK have been secured as firm orders. In Taiwan, 900 MW of preferred supplier agreements have been secured with two customers. In the US, the joint venture took a major step forward as it was named preferred supplier for the 800 MW Vinyard Wind project and is thereby well positioned for the build-up of offshore power in USA.

Financial ambitions 
The V164 offshore wind turbine continues to be a success in the marketplace and as a result of a strong order intake, factories are ramping up production in anticipation of the increasing volume of new installations.

Accordingly, MHI Vestas Offshore Wind expects to double its revenue over a four-year period from a base of its completed financial year 2017/2018, while continuously improving profitability. In addition, the ambition is to build a leading offshore service business from the growing installed base.

Social and environmental performance

Highlights 2018  Global
Total recordable injuries (No.) 
Emission of direct CO2  
Number of employees 

Read more (pdf)


Sustainability at the core
Vestas produces renewable energy solutions across the globe. From manufacturing, installing, and servicing wind turbines, the heart of the business is anchored in producing affordable and clean energy for the benefit of the world’s population.

Vestas understands that reaching its vision to be the global leader in sustainable energy solutions also requires delivering on its social and environmental performance. Continuous improvements in these areas form the baseline for how Vestas works, and partnerships are an important element contributing to this work.

Vestas’ sustainability work is organised around three central themes: 

  • Citizenship
  • Responsible operations
  • Sustainable product and services

Complementing these three central themes are two material themes: business ethics and human rights. For more information on how Vestas works with these areas, including examples, please refer to the annual report 2018, page 28.

Vestas is committed to the UN Sustainable Development Goals
Vestas’ business connects directly or indirectly with all the UN Sustainable Development Goals (SDGs). There are six SDGs that Vestas has selected where Vestas has the greatest possible impact: 

  • Climate action (13)
  • Affordable and clean energy (7)
  • Quality education (4)
  • Decent work and economic growth (8)
  • Responsible consumption and production (12)
  • Partnerships for the goals (17)