TCS salary hike update: Will employees get increments in 2025 amid challenging times?

Tata Consultancy Services (TCS) employees may have to wait a little longer for clarity on salary hikes this year. Chief Human Resources Officer Milind Lakkad announced during the company’s Q4 earnings press conference that the decision on salary increments will be made later, depending on how the business environment evolves.

“Considering the uncertain business environment, we will decide during the year when to make that happen,” Lakkad stated.

Expected Salary Hikes: Lower Than Previous Years

Due to ongoing challenges in the IT sector—including global economic slowdowns, trade tensions, and fears of a US recession—TCS is expected to offer smaller raises this year, estimated between 4% and 8%. This would mark the lowest hike in the past four years.

Here's a comparison:

FY22: 10.5% hike

FY23: 6–9% hike

FY24: 7–9% hike

Q4 Results and Annual Performance

Despite the cautious tone, TCS reported a strong deal pipeline. For the quarter ending March 31, 2025 (Q4 FY25), net profit dropped 1.68% YoY to ₹12,224 crore. However, for the full FY25, TCS posted a 5.76% rise in net profit, reaching ₹48,553 crore.

The company also clocked a record total contract value (TCV) of $12.2 billion in Q4, with a healthy book-to-bill ratio of 1.6.

FY26 Outlook and Hiring Plans

Looking ahead, TCS CFO Samir Seksaria maintained the company’s revenue guidance of 26-28% for FY26. He acknowledged that factors like lower utilisation could impact operating leverage but emphasized that the current challenges also open up opportunities for cost optimization.

On the hiring front, TCS added 42,000 employees in FY25, and the company plans to hire a similar or even higher number in FY26, according to Lakkad.

As of March 2025, TCS’s total workforce stood at 6,07,979, up by 625 from the previous quarter. The company’s IT services attrition rate was 13.3%, slightly higher than the 13% seen in the December 2024 quarter.