TCS Shares Slip Over 1% as Firm Cuts 12,000 Jobs in Largest-Ever Layoff Move

In what is being referred to as one of the largest layoffs in the company's history, Tata Consultancy Services (TCS) plans to eliminate over 12,000 positions worldwide, or about 2% of its workforce. The IT major has emphasised that the decision is not related to job replacements caused by artificial intelligence.

TCS CEO K Krithivasan denied rumours that the company's decision was motivated by AI-driven productivity increases in an interview with Moneycontrol, stating that the layoffs were caused by a talent mismatch and the company's incapacity to repurpose some workers in line with its changing business strategy.

Who Is Impacted

The layoffs will target mid‑ and senior‑level employees, especially those in roles like legacy technology specialists, non-client-facing managers, and project leads whose skills are no longer aligned with evolving business needs. With a headcount of 613,000 worldwide as of the end–June 2025, roughly 12,200 employees will lose their roles abruptly as TCS reorganises its talent structure. 

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Employee Support Measures

While retraining and redeployment efforts are underway, Tata Consultancy Services noted that not all affected employees could be absorbed into new roles. For those impacted, the company is offering severance packages, full notice‑period salary, extended health coverage, and outplacement support, including career counselling—some reports mention additional three‑month payouts. TCS has also revised its internal bench policy. Employees must now log at least 225 billable days per year and face a maximum of 35 days on bench before consequences such as job loss or denial of experience letters arise. 

Market Reaction and Industry Impact

Following the announcement, Tata Consultancy Services shares fell nearly 1.37%, touching ₹3,081.20 on the BSE, signalling investor concern over the mass layoffs and technology‑driven industry shift.

This marks TCS’s largest workforce reduction ever and highlights broader trends reshaping India’s ₹283 billion IT sector—where automation, AI integration, and slowing client spending are driving transformation.

Experts note that this move fits within a wider industry pattern: generative AI and automation are gradually reducing demand for human‑intensive services, forcing IT firms to reconfigure their workforce models to maintain competitiveness and margins. 

CEO Krithivasan emphasised that while AI deployment is a key enabler of efficiency, the layoffs are primarily due to the inability to redeploy certain roles effectively—not a direct reaction to AI alone.

Conclusion

Tata Consultancy Services Ltd’s announcement of over 12,000 job cuts—targeting mid- and senior roles—signals a strategic shift toward AI-powered agility amid weakening demand. While retraining efforts and support packages offer relief, the layoffs underscore a stark reality shaping India’s IT sector: automation is triggering a carefully calibrated workforce cull to stay competitive in a changing global environment.