TCS Confident Disruption From Tariffs Only Temporary, Says CEO Krithivasan

Krithivasan emphasised that the company’s robust deal pipeline, anchored by an order book exceeding $39 billion, provides sufficient momentum to sustain revenue generation.

Discussing regional performance, Krithivasan said that the company anticipates a recovery in North America once the current economic environment stabilises.

Source : Ambition Box

Despite growing concerns about sectoral uncertainty triggered by recent tariff-related developments, Tata Consultancy Services (TCS) CEO and MD, K Krithivasan remains optimistic. 

In an interview with PTI, he expressed confidence that the disruption would be temporary. The executive noted that the uncertainty is short-lived and the matter would be resolved in a period of months. 

Krithivasan emphasised that the company’s robust deal pipeline, anchored by an order book exceeding $39 billion, provides sufficient momentum to sustain revenue generation. He noted that although some clients have temporarily paused discretionary spending, there has been no pressure on pricing. On the contrary, pricing has seen a mild increase, both on a year-on-year basis and sequentially, he pointed out.

While he did not quantify how much discretionary spending contributes to the company’s over $30 billion revenue, Krithivasan acknowledged its significance. However, he remained unfazed by the current dip in this category, reinforcing that TCS continues to convert new deals into revenue without any noticeable decline. "It will take months of the uncertainty prolonging for it to change," he added.

Growth Prospects, Market Shifts, and Strategic Adjustments

Discussing regional performance, Krithivasan said that the company anticipates a recovery in North America once the current economic environment stabilises. The region’s share in TCS’s total revenue has dipped to 48 per cent. While progress in India-US trade discussions won’t directly influence TCS’s operations, a prolonged slowdown in the US could affect client strategies across industries.

Cost optimisation remains a priority for several clients, according to Krithivasan. Compressing vendor pricing is among the strategies being adopted, and in some cases, TCS has offered “tactical discounts.” Despite this, pricing overall continues to trend upward.

He also touched upon improvements in resource deployment, mentioning that utilisation rates have recently gone up. The company aims to maintain India’s contribution to revenues at 8 per cent. The spike in revenue from India in FY25 was partly driven by a large BSNL deal—though similar deals may not recur, TCS is eyeing opportunities from sectors like banking.