Mumbai, July 11, 2025 – Tata Consultancy Services (TCS), India’s leading IT services company, has released its Q1 FY26 financial results, shedding light on its performance and plans for employee salary hikes. As Indian TCS employees eagerly await updates on increments, here’s a comprehensive overview of the latest developments, tailored for the workforce in India, brought to you by Bharat Tone.

TCS Q1 FY26 Financial Highlights

TCS reported a consolidated revenue of ₹65,097 crore for the April-June 2025 quarter, reflecting a modest 1.3% year-on-year (YoY) growth from ₹63,575 crore in Q1 FY25. However, in constant currency terms, revenue dipped by 3.1%. The company’s net profit grew by 6% YoY to ₹12,760 crore, up from ₹12,040 crore in the same period last year. Earnings per share (EPS) stood at ₹35.27, showcasing steady financial health. TCS also declared an interim dividend of ₹11 per share, reinforcing its commitment to delivering value to shareholders.

Despite global economic challenges, TCS maintained an impressive EBIT margin of 26.1%, highlighting its operational efficiency. The company secured $9.4 billion in deal wins, slightly lower than the $12.2 billion in the previous quarter, with strong contributions from the Banking, Financial Services, and Insurance (BFSI) sector. These results underscore TCS’s resilience amid global trade uncertainties and a potential US recession.

Salary Hike Updates for Indian TCS Employees

Indian TCS employees are keenly focused on salary increments for FY26, but the company has postponed its decision due to macroeconomic uncertainties and delayed deal closures. During the Q1 FY26 earnings press conference on July 10, 2025, Chief Human Resources Officer (CHRO) Milind Lakkad stated, “We are yet to finalize our decision on salary hikes and will announce updates as soon as the business environment stabilizes.” TCS is likely to review hike plans later in FY26, possibly in the second half of the fiscal year.

Initial reports suggested that TCS planned salary hikes of 4-8% for Indian employees in FY26, with offsite staff potentially receiving 7-8% increments and high performers eligible for 12-15% raises. Onsite employees were expected to see 2-4% hikes. However, these plans were deferred in April 2025 due to global economic concerns, including US tariff policies and market volatility. This cautious approach mirrors TCS’s strategy during the 2020 COVID-19 pandemic.

To support its workforce, TCS continues to disburse quarterly variable payouts. In Q4 FY25, 70% of Indian employees received 100% of their eligible variable pay, with others receiving payouts based on their business unit’s performance. Additionally, TCS has tied salary increments and variable pay to compliance with its return-to-office (RTO) policy, implemented in early 2024, which mandates a five-day office workweek for most employees in India.

Workforce and Hiring Plans in India

TCS’s employee headcount reached 613,069 in Q1 FY26, with India being the largest contributor to its workforce. The company added over 5,000 employees this quarter, up from 607,979 in Q4 FY25. TCS onboarded 42,000 freshers across India in FY25 and plans to hire a similar or higher number in FY26, focusing on campus recruitment to meet demands for skills in AI, cloud computing, and digital transformation. However, attrition rose to 13.8% in Q1 FY26, a two-year high, compared to 13.3% in Q4 FY25. TCS is actively working to improve retention through employee engagement initiatives and career development programs.

What This Means for Indian TCS Employees

The delay in salary hikes has sparked discussions among TCS’s vast Indian workforce, particularly in tech hubs like Bengaluru, Mumbai, and Chennai. While the company’s cautious approach is understandable given global economic challenges, employees are hopeful for clarity on increments by late 2025. The RTO policy’s linkage to pay hikes has also raised concerns, as some employees face challenges transitioning back to full-time office work.

TCS’s focus on fresher hiring and skill development offers opportunities for young Indian professionals entering the IT sector. However, the rise in attrition signals a need for enhanced employee support, especially in a competitive job market where other IT firms like Infosys and Wipro are also navigating similar challenges.

Future Outlook for TCS in India

TCS remains optimistic about FY26, with expectations of stronger growth in India and international markets compared to FY25. The company’s investments in emerging technologies, leadership development, and consistent hiring underscore its commitment to maintaining its position as a global IT leader. Indian employees can expect updates on salary hikes as global conditions improve, potentially aligning with stronger deal wins and revenue growth.

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Keywords: TCS Q1 FY26 results, TCS salary hike 2025, Indian TCS employees, Tata Consultancy Services, IT jobs in India, return-to-office policy, TCS fresher hiring 2025, Milind Lakkad, Indian IT sector

Disclaimer: Information is based on recent reports and may change. For official updates, visit TCS’s official website.