Tata Consultancy Services (TCS) has posted strong financial results for the first quarter of FY26. However, the company has yet to confirm salary hikes for its employees. Despite a 6% year-on-year increase in net profit, totaling Rs 12,760 crore, there’s still no update on pay raises.
The announcement was made during the Q1 earnings call on July 10, 2025, by Milind Lakkad, Chief Human Resources Officer at TCS. He stated that the company is still evaluating the situation and no decision has been finalized.
Revenue Grows Slightly Amid Global Uncertainty
TCS also reported a 1.3% rise in revenue, reaching Rs 63,437 crore for the April–June period. While profits show solid growth, the company continues to tread cautiously due to ongoing global challenges.
Earlier this year, TCS had suggested that pay revisions would be tied to business performance and market conditions.
Attrition Rate Climbs to Two-Year High
While financials improved, employee retention remains a concern. The attrition rate rose to 13.8%, the highest in two years, compared to 13.3% in the previous quarter.
TCS has acknowledged that this is above their preferred range of 13%. Efforts are now underway to bring attrition back under control.
Over 5,000 New Hires Added in Q1
Despite the rising attrition, TCS continues to expand its team. The company added over 5,000 new employees during the quarter, bringing the total workforce to 613,069. This is up from 607,979 in the last quarter, signaling ongoing business momentum.
Indian IT Sector Remains on Growth Path
TCS’s performance aligns with the broader strength of the Indian IT industry. The sector is seeing robust demand for cloud services, AI, and digital solutions. According to IBEF data, the IT sector is expected to contribute $380 billion to India’s GDP by 2026, with 14 million new tech jobs forecasted.
Employees Left Waiting Despite Business Growth
Even with a growing workforce, higher profits, and an expanding tech market, employees are still in the dark about pay hikes. This uncertainty could impact morale, especially as other firms in the sector move forward with salary adjustments.
The message from TCS is clear: while the business is doing well, employee salary decisions are on hold for now. As the IT industry continues to grow, TCS may need to act soon to retain talent and remain competitive.
