Most of those affected are mid and senior-level staff. The layoff represents around 2 percent of the company’s total workforce, marking a stark shift for an organisation known for stability and gradual scaling.
As reported by TOI, K Krithivasan, CEO and Managing Director at TCS, said, “The continued global macro-economic and geo-political uncertainties caused a demand contraction.”
The layoffs signal a growing trend where job security in Indian IT, long considered a given, can no longer be taken for granted.
Infosys takes a different path
As TCS lets go of thousands, Infosys is choosing a steadier route. Chief Executive Salil Parekh made it clear that job cuts are not on the table.
“We recruited over 17,000 people (gross hiring) in the first quarter and plan to bring in about 20,000 college graduates this year,” said Parekh.This isn’t just about hiring. Infosys has also trained over 275,000 employees in artificial intelligence at various levels. That investment is being positioned as the company’s shield against the volatility seen elsewhere in the sector.
Reskilling as core strategy
Infosys is doubling down on upskilling. AI, cloud computing and enterprise platforms are now central to its workforce plan.
“We’ve been deeply focused on AI transformation, whether it’s building AI agents or developing smaller language models internally,” said Parekh.
The firm’s strategy rests not only on keeping pace with technological change, but on anticipating it. Strategic consolidation of client partnerships is also opening up new internal roles. This echoes what Infosys achieved during its earlier digital transformation years — creating room for talent by pivoting into fresh demand areas.
Growth guidance and market confidence
Infosys recently updated its guidance for FY26, raising the lower end from 0 percent to 1 percent. The new range is 1 to 3 percent in constant currency, which may look modest, but it reflects the current state of the global market.
Parekh added, “If you look globally — especially in Europe and the US — macroeconomic shifts are either stabilising or still playing out. My view is that as these trends mature and the environment becomes more stable, we will return to stronger expansion.”
Technology remains at the centre of this rebound, with demand continuing in areas like data and process transformation. Infosys sees this phase as a structural reset, not a collapse.
Changing models, same intent
With automation gaining ground, industry watchers have questioned whether traditional models like the bench system or pyramid hiring still apply.
Parekh responded, “There are clear changes in the business model, but they also open new opportunities. AI allows for deeper automation and insights but also demands higher-level skills and more effort.”
Infosys maintains that its utilisation model is intact. The approach remains centred on aligning talent with project needs. The graduate intake programme continues to feed into this model, ensuring continuity in delivery.
AI’s promise still needs people
While automation and AI tools are accelerating productivity, Parekh emphasised that human involvement is not going away.
“We’re seeing 5 to 15 percent productivity gains in software development through AI and automation, and even more in customer service and knowledge tasks. But human involvement remains central, especially in complex, integrated systems,” he said.
The Infosys Finacle banking platform, for example, shows a 20 percent productivity lift by pairing automation with human oversight.
Infosys compensation: No surprises yet
On the subject of salary revisions, Infosys has kept things predictable. Increases were completed for Q4 and Q1 of the last fiscal year.
“The process remains comprehensive and applies across levels. We will continue with this approach,” said Parekh.
Though the company is evaluating the next cycle, no changes are expected. During the COVID-19 years, the standard pattern had shifted, but normal scheduling has since resumed.
Hiring target unchanged, despite modest headcount bump
Infosys added just 210 net new employees in the latest quarter. That’s a sharp contrast to its previous pace, but the hiring plan for 20,000 graduates this year is still in place.
“Our utilisation is healthy, and our cautious approach reflects macro conditions. As the outlook becomes more stable, hiring will adjust accordingly,” Parekh said.
It’s a balancing act: meeting client needs while avoiding overcapacity. For now, the company believes it has struck the right equilibrium.
Engagement with GCCs and custom client models
Infosys continues to deepen its work with Global Capability Centres (GCCs), supporting clients through AI integration and tech transformation.
“We bring deep institutional knowledge and work closely with clients to scale GCC operations, implement AI, and roll out next-gen technologies,” Parekh explained.
Each vertical is now managed with closer collaboration. The firm also offers bespoke solutions for clients that need tailored models — from SaaS launches to public cloud adoption.
Revenue mix and selective transformation work
One red flag was a sharp drop in third-party revenue in Q1. Currently, licensing revenue makes up 7 to 8 percent of the company’s earnings, which may raise concerns about the strength of its core service offerings.
But Infosys says it’s making deliberate choices.
“We expect third-party revenue to stay subdued this year, as we pursue such work only at the client’s specific request,” said Parekh.
Full-scope projects, involving software, hardware, and services, are only accepted when absolutely necessary. Where possible, Infosys takes a support-only role.
Industry context: A decade of growth meets market reality
TCS, Infosys, Wipro, and HCL Technologies together employ over 1.37 million people. Over the last decade, these firms expanded aggressively, especially after the pandemic sparked a digital surge.
TCS alone added nearly 293,000 employees over ten years, growing from around 319,000 in FY2015 to over 613,000 by June 2025. Infosys followed with an 84 percent increase, reaching 323,578 staff. Wipro grew its base by 64 percent, and HCL Tech more than doubled its workforce to over 227,000 by FY2024.
But after peaking in FY2023, all four have seen a shift in hiring momentum. Now, the priority is realignment — more automation, sharper efficiency, and fewer bets on headcount-heavy growth.
The TCS layoffs may mark the end of an era of unchecked expansion in Indian IT. But Infosys is signalling that thoughtful reskilling, investment in freshers, and steady tech transformation can offer a different way forward.
For professionals watching closely, one thing is clear. The job market is evolving, but adaptation — not panic — will decide who stays relevant.
