Tata Consultancy Services (TCS) has announced a significant milestone in its artificial intelligence journey, with its annualised revenue from AI services now standing at a substantial $1.5 billion. The revelation was made by CEO K Krithivasan during the company's analyst day event in Mumbai on Wednesday.
AI Becomes a Core Growth Engine for TCS
Krithivasan highlighted that the AI services segment is experiencing explosive growth, expanding at 38.2% year-on-year in constant currency terms. This pace significantly outpaces other key service areas like cybersecurity, cloud, and IoT. The quarterly growth was also robust at 16.3% quarter-on-quarter. Furthermore, the company disclosed that over 85% of its clients with revenues exceeding $20 million are now leveraging TCS for their AI-related projects.
"AI is becoming a core growth engine across TCS' portfolio," stated Krithivasan. He positioned this shift from digital to AI as a "massive opportunity" for both enterprises and TCS itself. The company's overall annualised revenue across its newer service offerings, including AI, now totals $11 billion.
Building an "AI-First" Culture and Strategy
At the heart of TCS's strategy is a profound internal transformation aimed at embedding an "AI-first" mindset. Krithivasan explained this cultural shift, stating that for every project or customer engagement, the first question asked is: "What can AI do here? Can AI do this better than what we are doing today—even if it ends up cannibalising our own revenue?"
He defined this as giving "AI the first right of refusal" before considering any other option. This transformation is anchored in five strategic pillars:
- Internal Transformation: TCS is becoming its own first customer to embed the AI-first culture.
- AI-Led Service Reimagination: Redefining every service line with AI at its core.
- Talent Transformation: Large-scale reskilling, team restructuring, and new delivery models.
- Reimagining Customer Value Chains: Focusing on end-to-end business transformation over incremental gains.
- Ecosystem Partnerships: Partnering and co-creating with the broader tech ecosystem to accelerate progress.
Talent and Training at the Forefront
TCS Chief Operating Officer Aarthi Subramanian provided details on the human capital aspect of this shift. The company has introduced a personalised AI learning coach powered by generative and agentic AI. This tool assesses an employee's skill level and career goals to provide tailored guidance.
Subramanian revealed that 180,000 TCS associates now possess higher-order AI skills, a number that has nearly doubled from the previous year. She emphasized that role transformation is critical, with every function from sales to delivery becoming AI-centric. New initiatives like the "AI Dojo" programme and roles such as "rapid-build engineers" have been launched to support this transition.
However, Subramanian clarified that for mid-level tasks, human agents continue to play supportive roles, with humans remaining at the forefront of complex decision-making.
Indian IT's AI Race and the Global Context
TCS's detailed disclosure of its AI revenue sets it apart from other large Indian IT services firms, which have generally not broken out AI revenue separately. The announcement positions TCS as a frontrunner in quantifying its AI success within the domestic industry.
Globally, competitor Accenture has moved aggressively, having committed $3 billion over multiple years to generative AI. Accenture reported that its generative and agentic AI revenue tripled to $2.7 billion in FY25 from the previous fiscal year, with bookings nearly doubling to $5.9 billion. This global context highlights the scale of the opportunity and the competitive landscape TCS is navigating.
Krithivasan expressed confidence in TCS's position, citing its "differentiated strategy, deep customer partnerships, execution discipline, and strong balance sheet" as key advantages to lead the AI transformation wave.
