Why TCS, Infosys, and Wipro Are Cutting Jobs Despite Revenue Growth?

India’s top IT companies Tata Consultancy Services (TCS), Infosys, Wipro, and HCLTech are witnessing an unusual trend: steady or rising revenues accompanied by workforce reductions or slow hiring. While this may seem counterintuitive, the underlying reasons are more strategic than financial.

Recent Developments in the Indian IT Sector

• TCS recently trimmed its workforce by over 12,000 employees roughly 2% despite positive revenue numbers.
• Infosys has paused fresher onboarding and reduced trainee intake.
• Wipro is selectively cutting roles, with a cautious approach to hiring.
• HCLTech, despite leading in revenue growth this quarter, has also slowed hiring.

This shift reflects a broader industry reset as companies adopt automation and recalibrate their employee structures, as per Business Standard report.

The Numbers: Revenue Growth vs Workforce Trends

Despite reduced hiring, top IT companies posted modest revenue growth in Q1 FY26 (April–June 2025):

Interestingly, revenue per employee is increasing, breaking from the long-held industry trend where revenue growth meant proportional hiring, the report added.

What’s Driving the Shift?

1. Rise of AI and Automation

Companies are embedding automation and generative AI tools into service delivery, improving efficiency and reducing dependence on entry-level talent.

• TCS’s CEO noted large scale AI deployment is reshaping operations.
• This tech-led shift reduces the need for traditional bulk hiring, especially in routine roles.

2. Reworking the Talent Pyramid

The conventional pyramid model with heavy entry-level hiring is being replaced.

• Firms are screening more rigorously, resulting in higher fresher rejection rates.
• Hiring now emphasises niche skills like AI, cloud computing, and cybersecurity.

Company-wise Response Snapshot

1. TCS

• Trimmed 12,260 jobs citing the need to be “future-ready.”
• Facing scrutiny from the Labour Ministry over delays in onboarding 600+ experienced professionals.
• Complaint filed by NITES (Nascent Information Technology Employees Senate) alleges offer letter delays.

2. Infosys

• Infosys paused onboarding, tightened trainee assessments.
• Hiring focused on experienced professionals with advanced tech skills.
• FY26 revenue guidance suggests flat to 3% growth.

Read More: TCS Share Price in Focus; Labour Ministry Summons Company Over Hiring Delay Allegations.

Conclusion

While layoffs and hiring freezes may raise concerns, these moves reflect a strategic shift not an economic downturn. As AI and automation take center stage, Indian IT firms like TCS, Infosys, and Wipro are optimising talent structures to stay competitive. For aspirants and professionals alike, staying relevant now means continuous upskilling and adapting to the sector’s evolving needs.

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