In an interaction with ET Now, K Krithivasan, CEO & Managing Director, and Aarthi Subramanian, Executive Director, President & COO, outlined how the company’s internal transformation, client engagement model, and growth strategy are being reshaped around AI and emerging digital ecosystems.
AI at the core of TCS’s transformation
TCS, India’s largest IT services exporter, has embarked on an ambitious plan to make every layer of its business “AI-led.”
Krithivasan said the company’s vision rests on five key pillars — internal transformation, AI-infused services, workforce upskilling, evolving business models, and expansion into adjacencies like data centres and sovereign cloud.
“We are investing heavily in building platforms, training our people, and creating infrastructure to lead in AI,” he said. “If we have to reach our rightful place, we need to transform internally, embed AI into every client service, and expand into areas that strengthen our presence in the global AI ecosystem.”
The company has already trained over 1.6 lakh employees in AI tools and processes. “Our workforce transformation is key to ensuring that every TCS employee becomes an AI practitioner,” he added.
AI-first culture: World’s largest hackathon
CEO Aarthi Subramanian highlighted TCS’s push to create an AI-first culture across its global operations. Over the past quarter, the company provided AI access to more than 600,000 employees and organised the world’s largest AI hackathon, where 280,000 employees participated over an eight-week period to build AI-led solutions.“All of us, including the leadership team, got hands-on with AI,” Subramanian said. “The hackathon was part of driving an AI-first mindset — we want every employee to experiment, innovate, and co-create with AI.”
She added that TCS is redefining every service line with a “human-plus-AI” operating model, combining human creativity and judgment with machine intelligence for faster, more scalable outcomes.
Every project now has an AI component
TCS’s leadership said nearly every client engagement today incorporates AI in some form — whether for improving productivity, accelerating delivery, or enhancing customer value.
“It’s becoming difficult to find a project that doesn’t have an AI element,” Krithivasan said. “Our ambition is that every TCS project will be AI-led, either through automation, analytics, or AI-enabled delivery.”
Subramanian added that embedding AI into all operations is no longer optional.
“To be competitive in today’s environment, you must make AI part of every interaction and every workflow,” she said.
Strong deal wins and outcome-based projects
TCS reported $10 billion in total contract value (TCV) for the quarter, with a healthy mix of large, multi-year projects and shorter, outcome-driven engagements.
“We now have rapid build projects that last 8–16 weeks, alongside traditional multi-year contracts — but every engagement now has AI built into it,” said Krithivasan.
He cited the company’s recent Tryg Insurance deal as an example of how AI is being integrated end-to-end — from IT operations to application development and transformation.
TCS is also conducting “AI Innovation Days” with clients, where teams co-create and test use cases in real time to convert hype into measurable business value.
Demand environment improving gradually
While macroeconomic conditions remain uncertain, TCS sees early signs of recovery in global tech spending.
“Discretionary demand is slowly improving,” Krithivasan said. “Earlier we spoke about project deferments and cancellations — those have reduced. As trade deals get signed and confidence returns, we expect spending to pick up.”
For the quarter, TCS reported constant currency revenue growth of 0.8%, improved operating margins by 70 basis points, and added over 18,000 employees. Despite wage hikes and severance costs, the company maintained profitability, supported by cost discipline and efficiency measures.
Sectoral outlook: BFSI leads, UK weakens
The BFSI segment continues to perform well globally, especially in North America, which remains TCS’s largest market. However, UK revenues declined due to a pricing adjustment in one of its long-term insurance contracts.
“The UK drop was linked to a scheduled price reduction under a per-policy model — a one-off adjustment,” Krithivasan clarified.
Expanding into data centres and sovereign cloud
One of TCS’s biggest strategic moves this year is its expansion into data centre operations — a segment with massive potential in India.
Krithivasan said the company’s decision is driven by both business opportunity and the need to deepen its participation in the AI value chain.
“India currently has around 1.2 gigawatts of data centre capacity, but demand is expected to grow to 10 gigawatts in the next five years,” he said. “We plan to add one gigawatt of data centre capacity over the next five to seven years.”
The company is also developing a sovereign, secure cloud offering to cater to Indian enterprises and government entities. These initiatives, he said, will strengthen TCS’s ecosystem partnerships with hyperscalers and AI players while opening new revenue streams.
AI everywhere: The road ahead
With a strong order book, improving demand outlook, and a rapidly advancing AI transformation, TCS is positioning itself for sustainable growth.
“Our goal is clear — every project we do will be AI-led,” Krithivasan reiterated. “We are embedding AI into everything we do — from internal processes to customer solutions — to redefine what it means to be a technology services company.”
Subramanian echoed this sentiment, saying AI would not just be a technology shift but a cultural transformation at TCS.
“We are building an organisation where humans and AI collaborate to deliver outcomes faster, smarter, and better,” she said.
as a Reliable and Trusted News SourceKey highlights
- TCS aims to become the world’s largest AI-led services company.
- $10 billion TCV in Q2; most deals have AI components.
- 600,000+ employees given AI access; 280,000 joined AI hackathon.
- Plans to build 1 GW data centre capacity in India.
- BFSI and North America drive growth; UK slowdown temporary.
- Margins expand 70 bps despite wage hikes.