TCS Share Price Tanks 28% YOY Amid 13.8% Attrition Spike: Can There Be A Connection?

TCS recently announced plans to reduce its workforce by about 2% (around 12,000 employees) in FY 2025–26. This move will primarily affect middle and senior-level managers and comes as part of a broader internal restructuring initiative.

But what’s grabbing even more attention is the timing. The layoffs coincide with a noticeable uptick in attrition and a sharp slump in TCS share price, sparking an important question: Does TCS’s share price tend to fall when talent walks out the door?

TCS’ Attrition at a Two-Year High

Over the past four quarters, TCS has seen a steady rise in its attrition rate, moving from 12.1% in Q1 FY25 to 13.8% in Q1 FY26. This is the highest level seen in two years. This indicates growing challenges in retaining experienced professionals, especially at a time when the IT sector is already dealing with global demand fluctuations and cost optimisation pressures.

A Pattern Emerges: Attrition and Stock Slide

Interestingly, the TCS share price seems to be following the attrition trend closely. In the early quarters of FY25, when attrition remained manageable, the stock performed well. But as employee exits accelerated, TCS share price began to falter. The biggest drop occurred in Q1 FY26, coinciding with both peak attrition and the layoff announcement.

Here’s how the numbers stack up:

In the short term, TCS share  price has fallen 0.66% in just the past five trading sessions, over 9% in the last month, and nearly 22% in the past six months. The year-on-year slide stands at around 28%.

What's Making Investors Anxious About TCS Share Price?

The rising attrition rate, large-scale layoffs, and an evolving organisational structure appear to be rattling investor sentiment. While TCS insists that the layoffs are not AI-related and that client services will remain unaffected, the uncertainty around job stability is hard to ignore.

To its credit, TCS is continuing to invest in AI capabilities, tech upskilling, and operational innovation. But that hasn't been enough to shield its stock from volatility triggered by concerns about workforce dynamics.

Read more: Car Loan for Tesla Model Y RWD: What You'll Actually Pay Over 5 Years at 9.5% Interest.

Conclusion

In the end, whether TCS can win back investor confidence may depend on how well it balances internal restructuring with talent retention and forward-looking growth. For those tracking such trends and planning strategic entries or exits in the market, maintaining an active demat account could offer flexibility in navigating such corporate shifts.

As TCS undergoes future transition, both investors and employees will be watching it closely to understand more about the parallel movement between stock price and attrition levels.

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