Tata Consultancy Services (TCS), India's largest IT services firm by revenue, has announced it will defer employee salary hikes that were scheduled to begin in April 2025, citing global economic uncertainty and tariff concerns.
"Because of the uncertain environment, we will decide during the year on wage hikes. It can be at any time, depending on business," said Milind Lakkad , Chief Human Resources Officer, during the company's post-Q4 earnings press conference in Mumbai on Thursday.
The decision comes as TCS reported mixed financial results, with a 5.3% year-on-year increase in consolidated revenue to ₹64,479 crore for the quarter ended March 2025. However, net profit dipped 1.7% to ₹12,224 crore, missing analyst expectations.
CEO K Krithivasan pointed to specific market challenges, noting, "There will be delays in discretionary spending if this continues," referring to the ongoing tariff war between the US and other countries.
Despite the salary freeze, TCS will maintain quarterly variable payouts. For Q4, 70% of employees will receive their full variable pay, while others will receive amounts based on business performance.
TCS to continue hiring from campuses
The company has continued hiring, adding 625 employees in the fourth quarter alone. TCS closed FY25 with a workforce of 607,979, representing a net addition of 6,433 employees over the year.
"We continue to hire from campuses, and the number could be slightly higher this year than what we added last year," Lakkad said, confirming plans to recruit approximately 42,000 fresh graduates in FY26.
This cautious approach echoes a similar decision made by the company during the COVID-19 pandemic. Industry watchers expect rivals like Infosys and Wipro, which report their Q4 results next week, to potentially implement similar measures as the IT sector navigates continuing global economic headwinds.
"Because of the uncertain environment, we will decide during the year on wage hikes. It can be at any time, depending on business," said Milind Lakkad , Chief Human Resources Officer, during the company's post-Q4 earnings press conference in Mumbai on Thursday.
The decision comes as TCS reported mixed financial results, with a 5.3% year-on-year increase in consolidated revenue to ₹64,479 crore for the quarter ended March 2025. However, net profit dipped 1.7% to ₹12,224 crore, missing analyst expectations.
CEO K Krithivasan pointed to specific market challenges, noting, "There will be delays in discretionary spending if this continues," referring to the ongoing tariff war between the US and other countries.
Despite the salary freeze, TCS will maintain quarterly variable payouts. For Q4, 70% of employees will receive their full variable pay, while others will receive amounts based on business performance.
TCS to continue hiring from campuses
The company has continued hiring, adding 625 employees in the fourth quarter alone. TCS closed FY25 with a workforce of 607,979, representing a net addition of 6,433 employees over the year.
"We continue to hire from campuses, and the number could be slightly higher this year than what we added last year," Lakkad said, confirming plans to recruit approximately 42,000 fresh graduates in FY26.
This cautious approach echoes a similar decision made by the company during the COVID-19 pandemic. Industry watchers expect rivals like Infosys and Wipro, which report their Q4 results next week, to potentially implement similar measures as the IT sector navigates continuing global economic headwinds.
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