India’s Tata Consultancy Services (TCS) Expects Tech Spending to Pick Up in North America
India’s largest software-services exporter, Tata Consultancy Services (TCS), expects its retail and manufacturing clients in North America to increase their spending on technology, following a similar upturn in its banking and financial services segment. The company’s Chief Financial Officer, Samir Seksaria, attributed the expected growth to a strong holiday season in the US, which should boost consumer sentiment and manufacturing, which has overcome labor issues.
TCS’ revenue in North America, its largest market, has declined for five consecutive quarters, but the company’s banking and financial services segment has posted its best performance since June 2023. Retail and manufacturing are the second- and fourth-largest revenue contributors to the company.
The company’s communications and media vertical, which is currently one of its laggards, is expected to see some pickup if interest rates start to decline. TCS’ CEO has also expressed optimism that the incoming US administration will remove policy uncertainty and boost client confidence to spend on discretionary projects.
The company has also played down concerns over the rise in insourcing by multinational corporations through global capability centers (GCCs), which could potentially slash work that would have been contracted to IT players in the past. India’s GCC market size is estimated to reach $105 billion by 2030.
TCS’ shares closed up 5.6% on Friday, its highest single-day rise since July 2024.
