On Friday, shares in the IT sector fell sharply, with the Nifty IT index declining by 2.31% to 30,904.40 points, diverging from the broader market, where the Nifty 50 index rose by 0.85% to 23,977.00. This downturn followed disappointing quarterly earnings from Tata Consultancy Services (TCS), which reported a 2.08% increase in consolidated net profit, amounting to ₹13,718 crore, and a 5.38% rise in revenue to ₹70,698 crore for Q4 FY26 compared to the previous quarter. Despite these increases, investor sentiment was dampened by a cautious outlook on demand and concerns regarding the impact of rapidly advancing artificial intelligence (AI) technologies on traditional IT services. A global research house has maintained an 'underperform' rating on TCS, setting a target price of ₹2,275, indicating a potential 12% downside from its last close of ₹2,589 on the National Stock Exchange (NSE). The IT sector has faced challenges this year, with fears of job automation due to AI developments, including the launch of Meta's Muse Spark, which could further disrupt the industry.