Tata Consultancy Services has pushed back against fears that artificial intelligence will lead to widespread job losses, as India’s largest IT services company announced a $37 million investment in a new technology campus in Brazil.
K Krithivasan, chief executive of TCS, said AI would not on its own cause mass layoffs in the outsourcing industry, even as automation reshapes client demand and delivery models. Speaking in an interview reported by the Financial Times, Krithivasan said the company did not expect further large-scale workforce reductions.
“AI is not going to create lay-offs by itself,” Krithivasan told the newspaper, adding that while some roles may become redundant in pockets of the organisation, the technology was largely driving productivity gains rather than outright job losses.
The comments come after TCS reduced headcount by nearly 30,000 employees—about 5% of its workforce—over the past two quarters, as global technology spending slowed, particularly in the US and Europe. TCS remains India’s largest private-sector employer.
Krithivasan said AI adoption was helping clients operate more efficiently, creating room for additional contracts and longer-term engagements. AI-related services, which include helping enterprises integrate and scale the technology, are gaining traction and offsetting pressure from slower discretionary spending, he said.
The reassurance on jobs coincided with TCS announcing one of its largest investments in Latin America. The company said it would spend $37 million to build a new delivery centre in Londrina, Brazil, which is expected to be completed by 2027 and create more than 1,600 jobs.
The new campus will consolidate TCS’s existing operations in the city and serve as a regional hub supporting clients across Brazil and Latin America. The facility will focus on technologies including artificial intelligence, cybersecurity, ERP platforms and cloud services.
The investment underlines TCS’s strategy of expanding delivery capacity in growth markets even as it tightens costs elsewhere. The company currently employs around 2,500 people in Brazil and serves more than 200 clients across sectors such as banking, insurance, healthcare and manufacturing.
Industry analysts say Indian IT services firms are repositioning themselves as AI adoption accelerates. Abhishek Pathak of Motilal Oswal Financial Services told the Financial Times that companies were partnering with AI model providers to build customised solutions for clients, even if it meant sacrificing some traditional revenue streams.
While the outlook remains uncertain, there are early signs of stabilisation. TCS reported quarter-on-quarter revenue growth of 0.6% to $7.5 billion in the December quarter, while annual revenue from AI services rose 17.3% to $1.8 billion over the same period.
Peers are also reporting stronger AI demand. Infosys recently raised its full-year growth forecast after securing large deals, including a $1.6 billion contract with the UK’s National Health Service, according to public disclosures.
Despite this, investor sentiment remains cautious. TCS shares are down more than 20% over the past year, reflecting ongoing concerns about the pace of recovery and the long-term impact of AI on the outsourcing model.
Krithivasan said AI-led growth would take time to translate into larger revenue pools as clients move from experimentation to full-scale deployment. “This technology delivers value in terms of productivity and in terms of helping you do things that you have not been able to do before,” he said. “We believe it is going to deliver value.”