Cyclone Ivy has uprooted trees and damaged homes in the Vanuatu capital, Port Vila.
Fallen trees covered some roads and power and phone lines have been cut to some areas.
Earlier, more than 2,000 people were evacuated from coastal and low lying areas of the capital.
Officials are out examining the damage and their reports are expected later this morning.
Communication with some of the country's outer islands is reported to have been cut off.
The Vanuatu Meteorological Service says Ivy is continuing to move south-southeast at about 9 knots and should clear the country by the early afternoon.
The Service says winds in the cyclone have reached 90 knots gusting up to 110 knots.