Tuesday, 15 April, 2025

Generative AI to Boost Margins Despite Productivity Cannibalization

Tata Consultancy Services (TCS) CFO Samir Seksaria stated that while generative AI (GenAI) may reduce revenues at the transaction level by enabling tasks to be completed with fewer personnel, it can enhance overall profit margins through increased volumes and cost efficiencies. He emphasized that transitioning to outcome-based pricing models will allow IT firms to share productivity gains with clients while retaining a portion to support margins.