Tata Consultancy Services Ltd. (TCS) has made its largest-ever round of job cuts as rising tensions with the US and a rapid shift toward artificial intelligence reshape India’s $280 billion IT services industry.
India’s biggest private-sector employer reduced its workforce by 19,755 employees in the quarter ended September 30, according to its earnings presentation.
The figure includes both layoffs and voluntary exits. TCS’s total employee count has now fallen below 600,000; the first time since March 2022; marking a 3.2% drop from the previous quarter. The company also set aside ₹11.35 billion ($128 million) for severance costs.
Chief Human Resources Officer Sudeep Kunnumal told analysts that TCS is halfway through its plan to cut 2% of its workforce by March next year, mainly at the mid and senior levels, due to a “skill and capability mismatch.”
The company is realigning its workforce to adapt to emerging technologies like generative AI.
Citi analysts described the move as a reflection of a weak business outlook. TCS’s quarterly profit fell short of expectations, mainly due to one-time costs tied to job losses.
The cuts come amid Donald Trump’s H-1B visa restrictions and new US tariffs on India, which have created additional headwinds for tech exporters.
While the direct impact of tariffs may be limited, reduced IT spending and geopolitical uncertainty are expected to weigh on companies like TCS.
TCS has already localized much of its US workforce to reduce dependency on H-1B visas.
“Our business model will be able to adapt quickly to any changes in immigration policy,” Kunnumal said, adding that the company will continue hiring people with “future-relevant skills.”
