TCS Headcount Drops By 19,700 In Q2FY26 Amid Restructuring And Layoffs

TCS Q2 Results 2025: India’s largest IT services company, Tata Consultancy Services (TCS), reported a net decline of 19,755 employees in the second quarter of FY26, a period marked by a broad restructuring exercise and layoffs impacting about 2 per cent of its workforce, or roughly 12,000 employees.

With the latest reduction, TCS’ total headcount stands at 6,13,069, the company said in its earnings release on October 9. This comes after the company added 5,090 employees sequentially in the previous June quarter.

Restructuring Costs Weigh on Profit

The Mumbai-headquartered IT major booked Rs 1,135 crore in restructuring expenses during the September quarter as part of its ongoing organisational realignment. The move pushed the company’s reported consolidated net profit to Rs 12,075

crore, slightly below analyst estimates.

Despite the job cuts, attrition improved to 13.3 per cent, compared to 13.8 per cent in the previous quarter, reflecting greater employee stability amid ongoing changes.

TCS highlighted continued employee upskilling efforts, noting that its workforce has collectively logged 3.3 crore learning hours year-to-date, acquiring over 26 lakh new competencies. Around 1.6 lakh employees are now proficient in artificial intelligence and machine learning (AI/ML).

For the quarter ended September 2025, revenue rose to Rs 65,799 crore, up 3.7 per cent sequentially and 0.8 per cent in constant currency terms. Operating margin improved by 70 basis points to 25.2 per cent, while net margin stood at 19.6 per cent.

This marks the second straight year of workforce contraction for TCS, following its first-ever headcount decline in FY24 since listing in 2004. In contrast, the company added 22,600 employees in FY23 and a record 1.03 lakh employees in FY22, reflecting the scale of its earlier expansion.

“I am honoured to take over this responsibility as we chart our path to becoming the world’s largest AI-led technology services company. I look forward to working with our employees and all stakeholders as we pursue this exciting vision,” said K. Sudeep, the incoming Chief Human Resources Officer, in the company’s statement.