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, customer engagement model and growth strategy are being reshaped around AI and emerging digital ecosystems.
AI is at the core of TCS’s transformation
TCS, India’s largest exporter of IT services, 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-based services, workforce upskilling, evolving business models and expansion into adjacent areas such as data centers and sovereign cloud.
“We are investing heavily in building platforms, training our people and creating infrastructure to lead in AI,” he said. “If we want to reach our rightful place, we must transform internally, embed AI in every customer service experience and expand into areas that strengthen our presence in the global AI ecosystem.”
The company has already trained more than 1.6 million employees in AI tools and processes. “Our workforce transformation is critical to ensuring that every TCS employee becomes an AI practitioner,” he added.
AI-first culture: The world’s largest hackathon
CEO Aarthi Subramanian highlighted TCS’s commitment to creating an AI-first culture across its global operations. Last quarter, the company provided AI access to more than 600,000 employees and hosted the world’s largest AI hackathon, in which 280,000 employees participated over an eight-week period to build AI-led solutions. “All of us, including the leadership team, started working on AI,” said Subramanian. “The hackathon was part of encouraging an AI-first mentality: 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’ business model, combining human creativity and judgment with machine intelligence for faster, more scalable results.
Every project now has an AI component
TCS leadership said that almost every customer engagement today involves AI in some form – whether it’s improving productivity, accelerating delivery or increasing customer value.
“It’s going to be difficult to find a project that doesn’t have an AI element,” says Krithivasan. “Our ambition is for every TCS project to be AI-led, whether through automation, analytics or AI-enabled delivery.”
Subramanian added that embedding AI in all operations is no longer optional.
“To be competitive in today’s environment, you need to make AI part of every interaction and every workflow,” she says.
Strong deals and results-oriented projects
TCS reported a total contract value of $10 billion this quarter, with a healthy mix of large, multi-year projects and shorter, results-oriented engagements.
“We now have rapid build projects that last 8 to 16 weeks, in addition to traditional multi-year contracts – but every job now has AI built in,” Krithivasan said.
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 also hosts ‘AI Innovation Days’ with customers, where teams co-create and test use cases in real-time to translate the hype into measurable business value.
The demand environment is gradually improving
While macroeconomic conditions remain uncertain, TCS is seeing early signs of recovery in global technology spending.
“Discretionary demand is slowly improving,” Krithivasan said. “Previously we talked about project postponements and cancellations – which have been reduced. As trade deals are signed and confidence returns, we expect spending to pick up.”
For the quarter, TCS reported constant foreign exchange revenue growth of 0.8%, improved operating margins by 70 basis points and added more than 18,000 employees. Despite wage increases and layoff costs, the company maintained profitability, supported by cost discipline and efficiency measures.
Sector Outlook: BFSI Leads, UK Weakens
The BFSI segment continues to perform well globally, especially in North America, which remains TCS’s largest market. However, British turnover fell due to a price adjustment in one of the long-term insurance contracts.
“The decline in the UK was related to a planned price reduction under a policy model – a one-off adjustment,” Krithivasan clarified.
Expand to data centers and sovereign cloud
One of TCS’s biggest strategic moves this year is its expansion into data center business – a segment with huge potential in India.
Krithivasan said the company’s decision is driven by both business opportunities and the need to deepen its participation in the AI value chain.
“India currently has about 1.2 gigawatts of data center 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 center capacity over the next five to seven years.”
The company is also developing a sovereign, secure cloud offering to cater to Indian businesses and government agencies. These initiatives, he said, will strengthen TCS’s ecosystem partnerships with hyperscalers and AI players while opening up new revenue streams.
AI everywhere: the road ahead
With a strong order book, improving demand prospects 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 integrating 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 and said AI would not only be a technological shift but also a cultural transformation at TCS.
“We are building an organization where people and AI work together to achieve faster, smarter and better results,” she said.
as a reliable and trusted news sourceKey highlights
- TCS aims to become the largest AI-led services company in the world.
- $10 billion TCV in the second quarter; most deals have AI components.
- More than 600,000 employees will have access to AI; 280,000 people participated in the AI hackathon.
- Plans to build 1 GW data center capacity in India.
- BFSI and North America drive growth; British delay temporarily.
- Margins increase by 70 basis points despite wage increases.
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