India's TCS Shares Rise as AI Revenue Grows 20%
Tata Consultancy Services (TCS) shares increased by 3.5% on Monday, following the Indian IT services firm's report of nearly 20% growth in AI-related revenue for the quarter.
Shares of Tata Consultancy Services (TCS) rose 3.5% to 2,149.1 rupees (approximately US$22) in early trading on Monday. The increase followed the company's announcement of a nearly 20% rise in AI-related revenue for the July-September quarter.
AI segment revenues reached US$3.1 billion, up from US$2.6 billion in the previous quarter. This growth occurs as Indian IT firms generally experience a client shift towards AI, coupled with muted near-term revenue expectations across the sector.
The results were released shortly after the U.S. government suspended participation in the Permanent Labor Certification program for several IT services companies, including TCS. This program is critical for employers sponsoring foreign workers for U.S. green cards.
While TCS's H-1B visa applications had reportedly fallen to about one-third of 2015 levels by 2019, the current impact of the suspension on operations is being assessed. The broader trend within the Indian IT industry indicates a client focus on AI solutions, presenting both challenges and opportunities for service providers.