K Krithivasan, the CEO of Tata Consultancy Services (TCS), has expressed confidence that the Indian IT services industry will not face obsolescence by 2030. This assertion comes at a time when TCS reported its first annual revenue decline since going public in 2004, with a decrease of 2.4% in FY26.
Despite the downturn, TCS closed FY26 with a remarkable total contract value (TCV) of $40.7 billion, indicating robust demand for its services. “We have been writing its obituary every 10 years but I think Indian IT services have proven to be very resilient,” Krithivasan remarked, highlighting the sector’s enduring strength.
In a year marked by challenges, TCS hired 44,000 trainees and made 25,000 offers for the next hiring cycle, demonstrating a commitment to nurturing talent. Additionally, TCS completed its largest acquisition in over a decade by purchasing Coastal Cloud for $700 million, a strategic move to bolster its capabilities.
As the industry evolves, TCS is shifting towards AI-led roles and services, which Krithivasan notes will require a different skill set. “We will need a lesser proportion of programmers. We require model trainers, context/prompt engineers, people who can test models and agent developers,” he explained, underscoring the transformation within the sector.
Furthermore, TCS is making strides with its HyperVault data centre, expected to go live in 2028, with a target capacity of 1 GW. The company has already established two Memorandums of Understanding (MoUs) for the data centre and is in discussions for additional agreements.
Aarthi Subramanian, TCS’s Chief Technology Officer, pointed out that generative AI has unlocked significant opportunities in legacy modernization, particularly for large, decades-old systems like mainframes. This shift towards modernization is crucial for the future of the IT industry.
Looking ahead, Krithivasan remains optimistic about the industry’s prospects. “Definitely, we are more optimistic. I think some of the headwinds are behind us. So, that’s the opportunity,” he stated, suggesting that the worst may be over for TCS and the broader IT sector.
As TCS navigates these changes, the resilience of the Indian IT industry continues to be tested. Observers are keen to see how these strategic shifts will play out in the coming years, particularly as the demand for AI-driven solutions grows.
