New Delhi: India’s largest software exporter, Tata Consultancy Services (TCS), has reportedly increased quarterly variable payouts for mid- to senior-level employees, offering up to 80% for the third quarter. This marks a notable turnaround after nearly two years of relatively low payouts, signalling improving sentiment within the company, according to Moneycontrol report.
According to Moneycontrol, the hike comes after a long phase when variable pay for mid- and senior-level employees was restricted to around 20–50 per cent. The increase also comes at a time when the company is reshaping its workforce to strengthen AI-driven capabilities, while management continues to remain optimistic about a demand recovery in 2026.
Earlier, IT major Infosys rolled out performance bonus payouts averaging around 85 per cent for the quarter ended December 31, 2025 (Q3FY26). This marks the strongest variable pay outcome for eligible employees in at least the past three and a half years.
Variable Pay Sees Strong Comeback
After a prolonged period of cuts, variable pay has seen a noticeable recovery. According to employees familiar with the development, most mid-level staff received around 80 per cent of their variable compensation for the October–December quarter. One employee, who requested anonymity, said the payout is now closer to the variable component mentioned in offer letters.
For senior-level employees, payouts reportedly ranged between 40 per cent and 80 per cent. Another employee also confirmed receiving the October–December quarter variable pay in January.
Earlier, TCS had said that over 70 per cent of its workforce received 100 per cent of their quarterly variable pay. However, sources suggested that this benefit was largely limited to junior-level employees.
Leadership Confident About Deal Pipeline
The company’s leadership has expressed strong confidence in its deal pipeline. In the December quarter, TCS reported a total contract value (TCV) of $9.3 billion, beating market expectations. Speaking at the company’s earnings conference on January 12, CEO K Krithivasan said, “If this trend continues, we will be somewhere closer to about $38-39 billion for the year, which will be one of the highest. We believe this order book will help us in growing in FY27 as well. We are now quite comfortable with the order book itself.”
Despite global uncertainties such as geopolitical tensions, US tariff pressures and visa policy changes, the management remains optimistic. “As far as Q4 international revenue is concerned, we are optimistic, and we will take every step that is required to see we reach the aspiration of having a revenue better than FY25,” the CEO added.
