TCS headcount plunges to 14-quarter low amid restructuring drive
In contrast the firm’s attrition rate has stabilised significantly, reflecting a shift after the post-pandemic talent war
By Samreen Wani
Last Updated: Oct 10, 2025, 13:31 IST1 min
Advertisement
Tata Consultancy Services (TCS) has reported a sharp contraction in its employee base for Q2 FY26, with its total headcount plunging to the lowest level in 14 quarters. This significant workforce reduction is coupled with a moderation of attrition rates.
The total employee base stood at 593,314 employees at the close of Q2 FY26, according to the latest data from TCS’ quarterly results. This represents a steep sequential decline of nearly 20,000 personnel from the preceding quarter’s figure of 613,069. The headcount is now at a level not seen since Q4 FY22 (592,195), reflecting the deepest quarterly net reduction in recent company history.
TCS’s employee strength had peaked around Q1 FY24 at 615,318 before showing signs of plateauing. The recent, aggressive trimming is widely attributed to the company’s strategic ‘future-ready’ realignment efforts, which include a focus on upskilling, adoption of GenAI capabilities, and the consolidation of middle and senior management roles announced earlier. In July this year, TCS announced one of the largest redundancy programmes in Indian IT history, planning to lay off over 12,000 employees, or two percent of its global workforce.
Also Read
TCS: Layoffs are a low-hanging fruit
The large net reduction figure in the latest quarter suggests that hiring has been severely constrained.
In contrast to the dipping headcount metric, the company’s attrition rate has stabilised significantly, reflecting a shift from the aggressive hiring and elevated competition for talent seen post-pandemic.
The annual attrition rate, calculated on a last 12 months (LTM) basis for the IT services segment (excluding subsidiaries), stood at 13.3 percent in Q2 FY26. While this is a slight uptick from the 12.3 percent recorded in FY25, it marks a stark retreat from the extraordinary peak of 21.5 percent recorded in FY23, a period defined by a historical talent crunch driven by an imbalance between high market demand and limited supply. The current rate is now approaching the pre-pandemic levels seen in FY22 when the attrition rate was 11.9 percent.
With voluntary attrition largely under control, the significant decline in total employee strength is primarily management-driven, allowing TCS to right-size its workforce.
First Published: Oct 10, 2025, 13:31
Subscribe NowAdvertisement
Advertisement
Advertisement