Ørsted A/S

Overview

Ørsted A/S is the world's largest offshore wind developer and operator by installed capacity, with more than 10 gigawatts of operating offshore wind across Europe and the Americas. It was founded in 1972 as Dansk Naturgas A/S and later merged with other state-owned Danish energy assets to become DONG Energy, for Danish Oil and Natural Gas. In 2017, after a strategic pivot away from fossil fuels and an IPO in Copenhagen, it rebranded as Ørsted, named for the Danish physicist Hans Christian Ørsted, who discovered electromagnetism.

The Danish state remains the controlling shareholder at approximately 50.1% through the Ministry of Finance, which aligns the company's objectives with Denmark's national climate goals; the state reaffirmed that stake by taking up its full allocation in the 2025 rights issue. Ørsted is led by CEO Rasmus Errboe, who took over on February 1, 2025 after the departure of Mads Nipper amid significant financial pressure from the U.S. offshore wind market. Trond Westlie has been group CFO since April 2024.

The transformation from integrated oil, gas, and coal utility into a nearly pure-play renewable company is one of the most dramatic corporate pivots in energy. Ørsted divested upstream oil and gas to INEOS in 2017 and sold its legacy Danish generation, including coal and biomass, in the years after. By 2025, roughly 99% of power generation came from renewables, and it is frequently cited as the world's most sustainable energy company by indices including the Corporate Knights Global 100.

Business segments

Financial performance

FY2025 showed a company stabilizing after two turbulent years. Revenue rose about 3% to DKK 73.2 billion. EBITDA excluding new partnership agreements and cancellation fees was DKK 25.1 billion, within the guided DKK 24 billion to 27 billion range, or DKK 22.4 billion including those items. Ørsted returned to a net profit of DKK 3.2 billion, up from roughly break-even in 2024, with net debt at DKK 19.0 billion. Results still absorbed after-tax impairments of about DKK 2.9 billion, including the charge from discontinuing Hornsea 4. For 2026 the company guides to EBITDA above DKK 28 billion and gross investment of DKK 50 billion to 55 billion.

FY2023 was the watershed in the other direction: impairments of approximately DKK 28 billion, primarily on the U.S. offshore portfolio. Ocean Wind 1 and 2 in New Jersey, Skipjack in Maryland, and the early-stage Sunrise Wind were cancelled or written down as rising interest rates, supply chain cost inflation, and an inability to renegotiate power purchase agreements with state utilities made them uneconomic. The write-downs wiped out net income and triggered a sharp share price decline, with the stock falling more than 60% from its 2021 highs by the end of 2023.

The decisive step came in 2025. After abandoning a planned sale of half the Sunrise Wind project, Ørsted announced a roughly DKK 60 billion rights issue on August 11, 2025, ultimately raising DKK 59.56 billion at about 99.3% subscription and completing in early November. The Danish state took up its full 50.1% allocation, and the proceeds fund full ownership of Sunrise Wind and recapitalize the balance sheet. Ørsted paired the raise with a divestment program of roughly DKK 46 billion, including the Hornsea 3 stake to Apollo, the European onshore business to Copenhagen Infrastructure Partners, and 55% of Taiwan's Greater Changhua 2 to Cathay. Even so, S&P cut Ørsted to BBB- and Moody's to Baa2 in 2025, and the company suspended its dividend for 2024 and 2025, intending to reinstate it for 2026.

Strategy & outlook

Under Errboe, the strategy centers on restoring financial credibility, completing the 8.1 GW in-construction portfolio through 2027, and taking on new commitments selectively as project economics recover. As part of the reset, Ørsted discontinued its previous 2030 renewable capacity target in February 2025 and slimmed the investment program. Sanctioning new projects depends heavily on interest rates, power prices, supply chain costs, and regulatory support in target markets, all of which deteriorated sharply in 2022 and 2023 and have only partly recovered.

The UK remains the most important market, with one of the world's most mature offshore regulatory regimes, where Contracts for Difference provide revenue certainty over 15-year periods. The Hornsea franchise, with One and Two operating and the 2.9 GW Three under construction, keeps Ørsted a leading operator in UK waters. The larger Hornsea Four was discontinued in its current form in May 2025 as costs, interest rates, and execution risk mounted; Ørsted will not deliver it under the CfD it won in 2024 and did not re-bid in the following allocation round, though it retains the seabed rights, grid connection, and planning consent to evaluate future development. Taiwan is the key Asian market, where it established an early-mover position with Greater Changhua, and has since sold down part of that exposure.

The U.S. market remains consequential despite the write-downs, and is now the largest source of policy risk. Revolution Wind, a 704 MW project off Connecticut and Rhode Island held in a 50/50 joint venture with Skyborn, was about 87% complete when the federal government issued a stop-work order in August 2025. After a court injunction let work resume, a second suspension followed in December 2025, and a further injunction on January 12, 2026 again allowed construction to continue, with completion targeted for 2026. Sunrise Wind, the 924 MW New York project Ørsted now owns fully after buying out Eversource, is self-funded through the rights issue, with commissioning targeted for the second half of 2027.

Key considerations

The U.S. offshore wind market is the single largest risk factor. Federal actions against offshore wind, including a halt to new leasing and, in 2025, stop-work and suspension orders against projects already under construction, moved the risk from permitting delays to active interference. Revolution Wind was suspended twice and restarted twice by court injunction between August 2025 and January 2026, and a December 2025 order paused five projects across New England, New York, and Virginia. The litigation was unresolved as of mid-2026, and the outcome bears directly on both Revolution Wind and the fully owned Sunrise Wind.

Interest rate sensitivity is structural. Offshore wind projects are capital-intensive, long-duration assets whose economics turn on the discount rate applied to future cash flows. The 2022 and 2023 rate environment effectively repriced the entire sector. Rates have eased somewhat and remain above the levels at which many projects were originally underwritten, and the 2025 rights issue and divestment program were the response to the resulting balance-sheet strain.

On the other side, an installed base above 10 GW of operating offshore wind generates stable, largely contracted cash flows, though the dividend was suspended for 2024 and 2025 during the repair, with reinstatement intended for 2026. Technological leadership accumulated over three decades starting with Vindeby in 1991, the world's first offshore wind farm, gives genuine know-how advantages in a technically complex industry. And structural demand for offshore wind in Europe, driven by energy security after the Ukraine conflict and by decarbonization mandates, remains strong even as the U.S. market falters.

Sources