The recent report of layoffs by Tata Consultancy Services (TCS), involving the decision to lay off 2 per cent of its workforce, approximately 12,000 employees, as part of cost-cutting measures, could negatively impact the company in the long run, according to a report by Jefferies.

The report noted that this move reflects the company's increasing focus on conserving margins amidst persistent growth challenges. It is also the third such cost-saving action taken by TCS in the past three months. Earlier, the IT giant deferred wage hikes in April 2025 and introduced new benching guidelines in June 2025. The updated benching policy now limits the non-billable period of an employee to just 35 days in a year.

Jefferies stated, "Focus on cost-cutting may hurt TCS in longer-run...: The move by TCS reflects its growing focus on conserving margins amid continued growth pressures."