Mumbai - Tata Consultancy Services said it will reduce the pace of hiring as it works toward a future in which the number of AI agents equals the number of human employees, Chairman N Chandrasekaran told shareholders at the company's annual general meeting on Tuesday.
Chandrasekaran stressed that TCS is not planning to cut existing staff numbers as part of this shift. Instead, the company will bring on fewer new hires as AI agents take on an increasing share of work. He pointed to the company's recent workforce adjustments as context: in July 2025 TCS cut more than 12,000 jobs, and overall headcount fell by more than 23,000 on a net basis in the fiscal year that ended in March 2026.
"If the company has half a million employees, the day is not far when the company will have half a million AI agents... The company’s employees and AI agents will work together, and that will be the future," Chandrasekaran said.
India's IT industry - valued at $315 billion in the comments cited at the meeting - has faced investor anxiety that rapid adoption of AI could upend its traditional, labor-intensive business model. That anxiety has coincided with an industry-wide slowdown in hiring amid weakened client demand tied to geopolitical turmoil, management noted.
Chandrasekaran explained that as AI agents are deployed more widely, they will automate tasks that previously required human labor, which in turn will reduce the number of people that companies such as TCS and the broader IT sector need to recruit. He also said the transition will create new roles and opportunities as firms reconfigure how work is done in AI-driven environments.
"Some of the work being done will go to AI agents. That will be the nature of the transition that we have to go through not only as a company, as an industry, and as a country," he said.
Market reaction has been notable: shares of NSE:TCS have fallen more than 32% so far in 2026, compared with a 25% decline in the Nifty IT index over the same period.
Context and implications
Management frames the move as an evolutionary change in the firm's operating model rather than an immediate program of layoffs. The company believes the combination of human employees and AI agents will define future delivery models, with automation lowering demand for new hires even as some job categories evolve or emerge.
At the same time, the company acknowledged the broader environment of softer client demand and geopolitical uncertainty that has already influenced hiring decisions across the industry.
What was said
- Chandrasekaran confirmed a deliberate slowing of hiring while denying plans for further direct staff reductions.
- The company previously reduced payroll via a July 2025 cut of more than 12,000 roles and saw net headcount decline by over 23,000 in the fiscal year ended March 2026.
- He predicted a workforce where each employee is paired with an AI agent and emphasised that automation will shift the nature of roles across the company and the industry.