Tata Consultancy Services (TCS), a leading Indian IT company, recently unveiled its Q2 earnings, reporting a significant decrease in attrition compared to the previous year. In Q2 FY24, the Last Twelve Months (LTM) attrition rate for IT services stood at 14.9%, marking a notable improvement from the 21.5% attrition rate recorded in Q2 FY23. This represents a reduction of 6.6 percentage points. Furthermore, TCS saw a decline in attrition on a quarterly basis, with Q1 FY24 reporting an attrition rate of 17.8%.
All About TCS Q2 Earnings
During the quarter, TCS placed a strong focus on enhancing its AI capabilities. N Ganapathy Subramaniam, the Chief Operating Officer, highlighted that one-sixth of the company’s extensive workforce, comprising 600,000 employees, received training in GenAI.
Tata Consultancy Services now boasts a pool of 100,000 Gen-AI Ready consultants and prompt engineers actively involved in numerous Gen-AI projects for clients across various sectors. This emphasis on GenAI was driven by client demand, particularly in the realm of artificial intelligence, machine learning, and data sciences. TCS introduced specific services in these domains during the September-ended quarter.
Tata Consultancy Services also formed a unit dedicated to artificial intelligence, machine learning, and data sciences, integrating three hyperscaler-dedicated cloud units with specialists in these fields. This unit’s portfolio encompasses cloud migration, composite data foundation, application modernization, workplace transformation, edge-to-cloud solutions, and AI adoption frameworks. These strategic investments in enhancing competencies and cultivating new capabilities have continued to yield positive outcomes, driving growth in Q2.
In terms of hiring, TCS witnessed a reduction in net headcount, with 6,333 fewer employees. As of September 30, the company’s total headcount reached 608,985. Chief Human Resources Officer Milind Lakkad explained that hiring and employee additions remained subdued. TCS has implemented a strategy of proactively recruiting and training bright freshers with the necessary skills, a strategy that has proven successful. With this influx of talent and reduced attrition, TCS was able to adjust its gross additions, keeping them below departures, thereby increasing productivity and enhancing project outcomes.
