Tata Consultancy Services (TCS) has announced a net addition of 6,071 employees in the first quarter of FY26, bringing its total headcount to 6,13,069. The IT services giant released its Q1FY26 earnings report on July 10, 2025, revealing a 6% year-on-year rise in consolidated net profit, reaching ₹12,760 crore.

The company's revenue for the quarter stood at ₹63,437 crore, a marginal increase of 1.3% compared to the same period last year. However, in constant currency terms, the revenue declined by 3.1% YoY. Despite this, TCS demonstrated strong operating performance, with its operating margin expanding by 30 basis points sequentially to 24.5%.

TCS's Chief Executive Officer and Managing Director, K Krithivasan, acknowledged the impact of continued global macro-economic and geo-political uncertainties, which led to a demand contraction. Despite these challenges, he highlighted the strong growth in new services and robust deal closures during the quarter.

The company also reported a total contract value (TCV) of $12.2 billion in the last quarter. For the entire fiscal year 2025, the TCV stood at $39.4 billion.

The increase in headcount comes amid reports that TCS plans to onboard over 40,000 freshers in FY26, demonstrating a continued commitment to its long-term workforce strategy despite a volatile demand environment. While the broader IT sector is reportedly witnessing a slowdown in lateral hiring, TCS remains focused on fresher hiring as a strategic initiative.

Milind Lakkad, Chief Human Resources Officer at TCS, emphasized the company's commitment to talent development, noting that associates invested 15 million hours in building expertise in emerging technologies during the quarter. TCS now has over 114,000 employees with higher-order AI skills, reflecting its focus on developing future-ready talent in areas like artificial intelligence, cloud, and automation.

However, TCS also reported a slight increase in its attrition rate for the quarter, with the last twelve-month (LTM) rate rising to 13.8% from 13.3% in the previous quarter. This increase suggests that employee retention remains a challenge despite the company's investments in workforce training and development.

In addition to its financial and workforce updates, TCS has declared an interim dividend of ₹11 per share, with a record date of July 16, 2025, and a payment date set for August 4, 2025.

Analysts expect TCS to post muted sequential growth, with headwinds from the BSNL deal ramp-down offsetting gains in international markets. Kotak Institutional Equities anticipates TCS's EBIT margins to decline year-on-year and remain flat sequentially, as the company sees no operating leverage from growth despite postponing its usual April wage hikes.