TCS Share Price in Focus; Hikes Quarterly Variable Pay to 80% for Mid and Senior Level Employees in Q3

As per The Moneycontrol report, Tata Consultancy Services has increased its quarterly variable pay out to up to 80% for mid and senior level employees for the 3rd quarter, marking a shift after nearly 2 years of reduced payouts. 

TCS Raises Q3 Variable Pay After 2 Years of Cuts 

India’s largest software exporter, Tata Consultancy Services, has raised quarterly variable pay out for mid to senior level employees to up to 80% for Q3. Over the past 2 years, variable payouts for these categories had been reduced to between 20% and 50%. 

According to employees, most mid-level staff received around 80% of their variable pay, while senior-level employees received between 40% and 80%. Earlier, over 70% of employees, largely at junior levels, were reported to have received 100% quarterly variable allowance. 

AI Strategy and Workforce Realignment 

The move comes as TCS sharpens its focus on AI-driven priorities. The company reported $1.8 billion in annualised AI revenue and has worked on 5,000 AI related projects to date. For FY26, TCS plans to reduce about 2% of its workforce, or over 12,000 employees, primarily affecting mid and senior levels. 

In Q2, around 6,000 employees exited, followed by approximately 1,800 in the subsequent quarter. Overall headcount declined by about 30,000 during the period, with roughly 22,200 exits outside the restructuring exercise. 

Read More: ‘No Need to Panic’: TCS CEO Says AI Will Add Roles and Workloads, Not Job Cuts! 

Hiring Focus on Next Generation Skills 

TCS is increasing hiring of AI native freshers and lateral talent with next generation skills. The company is recruiting more professionals in cyber security, enterprise solutions, cloud, advisory, and consulting. Management indicated that over 50% of experienced hires now possess next generation skill sets. 

Deal Pipeline and Order Book Position 

In the December quarter, TCS reported $9.3 billion in total contract value, exceeding estimates of $7 billion to $9 billion. Management indicated that if the current trend continues, annual deal wins could reach approximately $38 billion to $39 billion. 

Tata Consultancy Services Share Price Performance  

As of February 19, 2026, at 1:38 PM, Tata Consultancy Services share price on NSE was trading at ₹2,700.70 up by 0.22% from the previous closing price. 

Conclusion 

The increase in quarterly variable pay to up to 80% for mid and senior level employees reflects a change in compensation trends at TCS after 2 years of moderated payouts. The development coincides with workforce restructuring, AI focused hiring, and a strong deal pipeline reported in the December quarter. 

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