TCS Shares Slide Despite Strong Deal Wins, Revenue Drop Raises Growth Concerns

Shares of Tata Consultancy Services (TCS) fell nearly 3% on Friday, marking their steepest decline in almost a month, after a rare annual revenue drop overshadowed strong deal wins and a quarterly earnings beat. The stock was also set to snap a six-session gaining streak, reflecting investor concerns over the company’s growth trajectory. TCS was among the top laggards on both the NIFTY IT Index and the benchmark NIFTY 50, even as the broader market traded higher.

Despite reporting better-than-expected fourth-quarter earnings and securing $12 billion in deal wins, TCS posted a 2.4% decline in full-year dollar revenue—its first annual drop since listing. Analysts flagged this as a sign of continued caution in client technology spending. Brokerages including Dolat Capital and Jefferies noted that while there was some sequential improvement, the results offered limited evidence of a meaningful recovery in demand, raising concerns about near-term growth visibility.

The weak sentiment extended across the sector, with U.S.-listed shares of rivals Infosys and Wipro also slipping nearly 2%. Analysts further warned that rising subcontracting costs, wage hikes, and continued investments in AI platforms could limit margin expansion going forward. TCS shares have declined about 20.5% so far this year, underperforming the IT index, as concerns around AI-led disruption and subdued client spending continue to weigh on the sector.

Pic Courtesy: google/ images are subject to copyright