TCS Q2 FY24: Generative AI Update

During the Q2 FY24 results press conference on Wednesday, TCS CEO Krithivasan revealed significant developments in the company's strategy around Generative AI (GenAI).

Krithivasan highlighted the launch of TCS’ AI.cloud business unit, marking a pivotal moment in the convergence of cloud computing, data and artificial intelligence (AI) technologies. He emphasised the importance of this strategic move, underlining the growing demand from TCS customers to harness the potential of cloud migration, composite data foundation, application modernisation, workplace transformation, and edge-to-cloud integration, all powered by AI and machine learning (AI/ML).

This new venture reportedly builds upon TCS's existing partnerships with leading hyperscale cloud providers and AI partners, aiming to provide exceptional value to their clients.

The CEO announced that TCS is engaged in over 250 GenAI-powered projects with their clients. To assist their customers in accelerating their GenAI adoption, the company has defined a catalog of use cases. TCS had previously invested in readiness training for their workforce, with 1 lakh associates already completing initial generative AI training. Further advanced training is underway to ensure TCS remains at the forefront of AI technology.

In addition to its efforts in AI adoption, TCS is advancing research and development (R&D) in this space. “We have filed for 218 patents in Q2 (FY24) and were granted 149 patents. Both the numbers are significantly higher than Q1,” revealed Krithivasan.

In Q1 FY24, TCS applied for 142 patents and was awarded 126, averaging nearly two patents per working day. 

The TCS CEO mentioned that TCS has received positive feedback on its AI initiatives during customer summits in North America and Europe, underlining their customers' interest in AI-driven solutions.

“We also had an opportunity to validate our future ready AI-first point of view and our four layered architecture for interface adoption of Generative AI in our customer summits in North America and Europe, which are very well received.” - TCS CEO K Krithivasan

The company’s net income for Q2 FY24 reached Rs 11,342 crore, reflecting year-on-year (YoY) increase of 8.7 per cent. TCS reported net profit of Rs 11,342 crore, which fell just short of market expectations. Analysts had been expecting a net profit of Rs 11,400 crore, while the consolidated revenue, which stood at Rs 59,692 crore, was also slightly below the street's expectations of Rs 60,100 crore.

Also Read: TCS Q2 FY24: 8.7% Net Profit Growth, Revenue Falls Below Expectations