Tata Consultancy Services (TCS) reported its first annual revenue decline since its listing, with a 0.5% decrease to $30.08 billion for FY26. This downturn was primarily driven by a 32% drop in revenue from its operations in India, reflecting challenges in the IT services sector amid macroeconomic uncertainties and the evolving landscape influenced by artificial intelligence (AI). Despite these challenges, TCS saw a 1.5% sequential growth in Q4 revenue, reaching $7.62 billion, suggesting a potential recovery as the fiscal year ended. The company’s net profit increased by 3.5% to $5.94 billion, aided by strategic layoffs and improved business mix. TCS's management remains optimistic about FY27, emphasizing strong client engagement and a focus on AI and modernization projects to drive future growth. The company also reported $2.3 billion in annualized AI revenue for Q1 2026, indicating a growing interest in AI solutions among clients, although many are not yet prepared for full adoption. TCS's workforce decreased to 584,519 employees, reflecting the impact of its largest layoff drive, while the company plans to implement wage hikes for eligible employees.