TCS Targets 80% AI And Digital Hiring, Growing AI Business Could Lift Margins
Mumbai: Tata Consultancy Services expects 80 per cent of its new hires to possess digital and artificial intelligence skills, reflecting a shift in workforce requirements as AI-led work expands. AI contributed 10 per cent of revenue in the September quarter. Management said rising business volumes in this segment could improve profitability, with margins still below the company’s aspirational…
Tata Consultancy Services (TCS) predicts that 80% of its future hires will have digital and artificial intelligence skills, signaling a transformation in the workforce due to the growing influence of AI. In the latest quarter, AI accounted for 10% of the company's revenue. Management disclosed that as AI and digital skills become more prominent, profitability could improve, although margins remain below the company's goals.
COO Arathi Subramanian announced that TCS added 4,500 employees in Q2, with around 25-30% being pure AI talent and the rest from new-age skill categories. They plan to maintain this hiring mix and believe a suitable talent pool exists in the market.
Subramanian emphasized the importance of digital capabilities as customers increasingly incorporate AI into various business functions. She noted that TCS favors professionals who are open to learning new skills throughout their careers, regardless of their stage. CEO and Managing Director K Krithivasan highlighted that mid-level engineers who actively learn bring a significant advantage due to their knowledge of technology environments and industry domains.
TCS will keep investing in specialized talent while pursuing mergers, acquisitions, and partnerships, he added.
The expansion of AI projects is expected to support margin growth. Subramanian explained that customers often start with AI projects in a limited business area but seek to expand their use across other functions once the value is demonstrated. TCS reported a total contract value of $9.6 billion in Q2, though the exact AI share was not disclosed. The company uses conservative criteria when classifying contracts, though AI is present in most current work.
Krithivasan dismissed suggestions that recent deals with Porsche and Best Buy, which involve taking on client employees, indicate market challenges. He viewed these arrangements as opportunities to assist customers in transforming their operations and becoming AI-first businesses, describing them as part of technology-led change.
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