TCS Share Price Declines On Company's Layoff Plans
The layoffs, targeting middle and senior management, are part of TCS’s restructuring initiative aimed at improving agility and aligning talent with evolving business needs.
Shares of Tata Consultancy Services came under pressure on Monday after the company announced plans to reduce its workforce by 2%, impacting over 12,000 employees.
The stock, which has already shed nearly 30% over the last one year declined 1.27% on Monday, reacting to investor concerns around execution risks and margin headwinds flagged by leading brokerages.
The layoffs, targeting middle and senior management, are part of TCS’s restructuring initiative aimed at improving agility and aligning talent with evolving business needs. CEO K. Krithivasan clarified that the move is not driven by artificial intelligence or cost-cutting, but by skill mismatches and redeployment challenges.
Brokerages have responded with caution. Citi reiterated its Sell rating, citing margin pressure, productivity challenges, and demand-skill mismatches as underlying factors. Jefferies warned that the layoffs could lead to execution slippages in the near term and potentially higher attrition over time.
