Mon Jul 14 04:10:00 UTC 2025: **News Article:**

**TCS Prioritizes Employee Wage Hikes Amidst Margin Pressures and Attrition Concerns**

**Mumbai, India – July 12, 2025** – Tata Consultancy Services (TCS), India’s largest IT company, has announced that delivering wage hikes for its over 600,000 employees is a top priority. Chief Financial Officer Samir Seksaria emphasized this commitment in a recent interview, acknowledging the importance of rewarding employees amidst current economic challenges.

While a specific timeline for the salary increases was not provided, Seksaria highlighted TCS’s historical record of rarely delaying wage hikes compared to its competitors. The announcement follows earlier comments from Chief Human Resources Officer Milind Lakkad, who stated on July 10th that no decision on wage hikes had been made yet.

The pressure to increase wages comes as TCS navigates a complex landscape. Annual salary hikes are estimated to impact the company’s operating profit margin by over 1.5%. In the April-June quarter of FY2025-26, TCS’s operating margins narrowed to 24.5%, a 20-basis-point decrease, as the company aims to reach a margin of 26-28%.

Adding to the challenge is a rising attrition rate, which reached 13.8% on a last twelve-month (LTM) basis at the end of the April-June quarter, a slight increase from 13.3% in the previous quarter. Seksaria described the attrition rate as “concerning,” indicating a renewed focus on retaining top talent, potentially leading to a slowdown in lateral hiring until demand increases.

Despite these pressures, TCS remains focused on growth and profitability. In the first quarter of FY2025-26, the company reported a 6% increase in consolidated net profits to ₹12,760 crore, while consolidated revenues rose 1.3% to ₹63,437 crore. Macroeconomic and geopolitical factors were cited as contributing to the relatively smaller increase in income.

While TCS plans to maintain its investment levels, some “realignments” are possible. Seksaria also clarified that the company will not pursue acquisitions solely for revenue growth, but will remain open to potential opportunities in the market.

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