Wärtsilä (WRT1V) Strategy update summary

Strategic outlook and market trends

• Marine demand remains robust, especially in core segments like cruise, ferries, and offshore, with volumes above the 10-year average despite a decline from 2024 peaks.

• Decarbonization and energy efficiency are central to long-term growth, with regulatory developments such as MEPC 83 potentially accelerating the transition.

• Service businesses in both marine and energy are growing, with renewal rates above 90% and a focus on moving up the value ladder.

• Divestments in non-core areas continue, and the company is adapting to geopolitical uncertainties and tariffs with limited current impact.

Market trends and opportunities

• Data centre power needs are shifting from backup to off-grid baseload, with demand rising to 50-300 MW in some markets.

• Grid interconnection delays of up to 5-7 years are driving demand for on-site baseload solutions.

• Over 50% of global data centres and more than 10% of electricity consumption in at least five US states highlight the sector's scale.

• $22 billion was invested in data centres in 2023, with the US market developing rapidly.

Energy sector developments

• Balancing power remains a key narrative, driven by global renewable growth and the rise of data centers as a new baseload demand.

• Data center power needs are increasing, with orders now materializing in both Europe and the U.S., particularly in the 20-400 MW range.

• Modularity, high fuel efficiency, and low water use are competitive advantages for engine-based solutions versus gas turbines.

• The project pipeline for data centers is active, with several opportunities in various stages and potential for further U.S. orders this year.