Tata Consultancy Services (TCS), India's largest software exporter and IT services firm, has announced plans to cut approximately 12,260 jobs, representing about 2% of its global workforce of 613,069 employees, during the fiscal year 2025-26. The layoffs primarily target mid- to senior-level managers as part of a strategic realignment to enhance agility amid evolving business needs and the generative AI era. CEO K Krithivasan clarified that the job cuts are due to a skills mismatch and operational realignment rather than direct AI-driven automation replacing jobs. The move aims to improve profitability, with potential annual savings estimated at around INR 3,600 crore. The announcement, made over a weekend, is the largest layoff in the Indian IT sector to date and has triggered concerns among employee unions and industry analysts about workforce planning and AI readiness. Following the layoffs, TCS has paused senior-level hiring and frozen annual salary hikes globally. The decision reflects broader industry trends, with other major IT and technology companies like Microsoft and IBM also implementing job cuts amid macroeconomic uncertainties and AI disruptions. Analysts warn that the layoffs expose deeper workforce challenges in the Indian IT sector, which has seen over 42,000 job reductions across top firms including Infosys, Wipro, and HCLTech in the past two years. The Karnataka government has stated that the layoffs are a business decision and do not require state intervention. The industry is emphasizing upskilling and reskilling initiatives to prepare employees for the AI-driven future, warning that those unwilling or unable to adapt risk losing their jobs.