DUBAI, United Arab Emirates (Diya TV) — Tata Consultancy Services, India’s largest IT services company, will cut about 2% of its global workforce—around 12,200 jobs—during the 2026 financial year. The move comes as the company restructures to align with growing demand for artificial intelligence (AI) and adjusts to tighter global tech budgets.
TCS currently employs around 613,000 people worldwide. The planned layoffs will mostly affect mid- and senior-level managers. The company calls the move part of a broader “future-ready transformation” to remain competitive in a changing digital landscape.
“This transition is being planned with due care to ensure there is no impact on service delivery to our clients,” TCS said in a statement released Sunday. The company added that it aims to streamline operations while retraining and redeploying staff to support AI-led services.
This marks the company’s second significant workforce reduction. In 2012, TCS let go of 2,500 employees due to underperformance.
The decision reflects deeper shifts in the global IT industry. Artificial intelligence is rapidly transforming how businesses deliver technology services. As more clients adopt AI tools, the need for large, people-heavy IT teams is shrinking.
TCS CEO K. Krithivasan admitted that high single-digit growth may not return anytime soon. Clients are taking longer to finalize contracts, and new project launches have slowed.
Many clients are also asking for price cuts of up to 30% in new deals, forcing firms like TCS to adjust their cost structures. “We are focusing on building capabilities in next-generation tech, deepening client partnerships, and entering new markets,” Krithivasan said.
India’s $283 billion IT sector is under growing pressure. Rising inflation, delays in client decisions, and budget cuts in key markets like the U.S. and Europe are slowing revenue growth.
TCS posted one of its weakest first-quarter results since the COVID-19 pandemic. Its revenue declined 3.1% in constant currency terms and 1.1% in dollar terms for the quarter ending in June.
The firm’s restructuring signals a larger shift in the industry. Many top Indian IT firms have already paused hiring or postponed onboarding recruits. Analysts say TCS’s announcement could prompt similar moves from rivals like Infosys, Wipro, and HCLTech.
TCS’s job cuts are part of a larger global trend. Layoffs.fyi reports that nearly 80,000 tech workers have been laid off across 169 companies so far in 2025. Microsoft alone has cut more than 9,000 jobs this year.
While tech layoffs are nothing new, TCS’s move is notable. The company is known for offering career stability and long-term employment, especially compared to many Western tech giants.
Still, the rise of AI and automation is forcing even the most stable companies to rethink their operations. Reducing headcount is one way to lower costs and invest in future technologies.
TCS insists it is taking a thoughtful approach to its restructuring. The company plans to retrain employees whose roles may be affected by AI and shift them to new functions.
Despite the cuts, TCS remains committed to investing in digital infrastructure, AI innovation, and global expansion. However, the road ahead may be rough, as the company and the broader IT sector navigate uncertain economic conditions.
For now, TCS’s move sets a new tone for the Indian tech industry, where stability has long been the norm. As the pressure to innovate grows, more firms may be forced to follow suit.
