Tata Consultancy Services (TCS) reported a decline in its workforce in FY26, even as it reaffirmed its commitment to large-scale hiring and future-ready capabilities. The company’s headcount fell by 23,460 employees during the fiscal year to 5,84,519, although it registered a sequential increase of 2,356 employees in the March quarter, according to a Times of India report dated April 13, 2026.
Hiring Momentum Continues with Focus on Freshers
Chief Human Resources Officer Sudeep Kunnumal reportedly clarified that the drop in headcount was not solely due to last year’s restructuring exercise. He reportedly added that the company has already made 25,000 campus offers and remains on track to hire around 40,000 freshers annually.
"Last year, we onboarded 44,000 trainees. We have already made 25,000 campus offers in India and will continue to be among the largest recruiters across universities and the market," he told TOI.
Kunnumal reportedly said hiring will remain aligned with business demand, alongside continued investments in capability building, with learning intensity rising 25 percent year-on-year. "At the same time, we are hiring externally for niche, future-ready skills in areas such as AI, advisory and consulting," he added, according to the report.
Kunnumal further noted that the restructuring exercise has been completed and accounted for a much smaller portion of the workforce reduction—well below the initially announced 2 percent. The decline was also attributed to efficiency gains, productivity improvements, and selective role replacements amid voluntary attrition.
TCS continues to hire externally for niche and future-ready skills, particularly in areas such as artificial intelligence (AI), advisory, and consulting.
Wage Bill Rises Despite Lower Headcount
The company had earlier announced plans to reduce around 2 percent of its workforce—over 12,000 employees—primarily at mid- and senior levels. Chief Operating Officer Aarthi Subramanian clarified that the restructuring was not driven by AI but by the need to build a future-ready workforce. Despite the reduction in headcount, TCS’s wage bill rose by Rs 10,000 crore in FY26, driven by higher bonuses, variable payouts, salary hikes, and approximately Rs 2,100 crore in labour code-related provisions.
AI Emerges as Key Growth Driver for TCS
According to the report, Subramanian highlighted FY26 as a turning point for enterprise AI adoption, with annualised AI revenue rising to USD 2.3 billion from USD 1.8 billion in the December quarter. "In 2023 and 2024, enterprises were largely experimenting with AI through pilots and proofs of concept. FY26 marks a shift towards scaled deployments. What we are seeing now is the transition from pilots to full-scale projects. This is driving incremental revenue growth quarter after quarter. We classify AI revenues clearly as AI transformation-led and do not include AI embedded within other services like software engineering," she said.
She further noted that TCS’s AI strategy focuses on building a full-stack “infrastructure-to-intelligence” ecosystem. Investments such as Hypervault are strengthening its infrastructure capabilities, supported by partnerships with OpenAI and broader ecosystem collaborations. The company also secured USD 1 billion from private equity firm TPG to advance its AI data centre strategy, with OpenAI expected to be the first customer of its Hypervault business, starting with 100 MW capacity and scaling to 1 GW over time.
