AI Wave Triggers Major Job Cuts at TCS as Industry Faces Global Shifts

Tata Consultancy Services (TCS), India’s largest IT services company, has announced its biggest-ever round of workforce reductions as the global tech landscape rapidly evolves with artificial intelligence and rising geopolitical challenges.In the quarter ending September 30, TCS reduced its workforce by 19,755 employees, bringing its total headcount to below 600,000 for the first time since March 2022. The company noted that these figures include both layoffs and voluntary exits, and it has set aside ₹1,211 crore ($128 million) for severance payouts.

According to Chief Human Resources Officer Sudeep Kunnumal, TCS is halfway through its plan to trim about 2% of its workforce by March 2026, particularly targeting mid and senior management levels due to a “skills and capability mismatch.” The move aims to realign its talent pool toward new-age technologies such as generative AI and cloud automation.Industry experts and Citi analysts view the job cuts as a sign of a soft business outlook, compounded by global uncertainties. TCS’s quarterly profit missed expectations, mainly due to one-time severance costs.Adding to the challenges, recent US visa restrictions and new tariffs on Indian exports under Donald Trump’s trade policies have further tightened conditions for Indian IT firms. However, TCS has already localized a large portion of its US workforce, minimizing the impact of visa changes.

“Our organization is structured to adapt quickly to evolving immigration and technology trends,” said Kunnumal. “We will continue hiring talent with future-relevant skills to meet client needs in the AI-driven era.”