IT Stocks Fall Despite Market Gains As TCS Revenue Declines, AI Developments Weigh

IT stocks came under pressure on April 10, with the Nifty IT index declining nearly 2%, even as benchmark indices traded over 0.5% higher, supported by global market gains.

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Most IT stocks in the index were in the red during early trade. Mphasis declined around 2.5%, while Infosys, Tata Consultancy Services (TCS), LTIMindtree, and Tech Mahindra fell by about 3% each.

TCS Earnings Impact Sentiment

Investor sentiment was impacted after Tata Consultancy Services reported a decline in its full-year revenue in dollar terms. According to the company’s exchange filing, TCS reported a 0.5% drop in annual revenue to $30.08 billion.

For the March quarter (Q4FY26), the company reported a 12.2% year-on-year increase in consolidated net profit at ₹13,718 crore, compared to ₹12,224 crore in the same period last year. Revenue from operations rose 9.6% to ₹70,698 crore from ₹64,479 crore in Q4FY25.

Quarterly revenue saw a 1.5% uptick, reaching $7.62 billion, a sign of slight progress. However, the company’s India business recorded a 32% decline in revenue during the year, which contributed to the overall drop in annual dollar revenue.

AI Model Launch Adds Pressure

Sentiment in IT stocks was also affected by developments in artificial intelligence. Anthropic introduced a preview of its new AI model, Mythos, focused on cybersecurity and advanced code analysis.

As per Reuters, the model is being implemented cautiously by way of “Project Glasswing” by giving access to a select group of partners like Amazon Web Services, Apple, Broadcom, Google, JPMorgan Chase, Microsoft, and NVIDIA.

In other words, the model can be used to find out and resolve cybersecurity weaknesses, but can also identify and exploit system vulnerabilities when required.

Wider View of the IT Industry

It must be noted that the fall in IT stocks occurs even as broader markets continue to stay bullish. Market indices started positively on April 10 on the heels of rising global stocks owing to news about a U.S.-Iran ceasefire.

On the other hand, the IT industry has had to deal with developments within the global technology sector as well as developments in individual firms.