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TCS Sees Revival in Retail and Manufacturing Sectors After Banking Recovery

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Tata Consultancy Services (TCS), India’s leading software-services exporter, is optimistic about a recovery in its retail and manufacturing sectors in North America, following a strong rebound in its banking and financial services segment. The company’s CFO, Samir Seksaria, pointed to improved consumer sentiment, driven by strong holiday season sales in the U.S. and a resolution of some labor issues in the manufacturing sector, as key factors contributing to this optimism.

Seksaria’s comments reflect a cautious yet hopeful outlook, acknowledging the broader economic uncertainties and persistent inflation that have led clients to tighten their tech spending. Despite the challenges, TCS expects a recovery in its retail and manufacturing verticals, which are among its top revenue sources. Retail and manufacturing combined account for a significant portion of TCS’s $29 billion in annual revenue, with recent sales figures from major U.S. retailers like Walmart, Amazon, and e-commerce platforms such as Shein and Temu contributing to the positive outlook. U.S. online spending also saw a nearly 9% increase, reaching $241.4 billion during the recent holiday season.

However, the company continues to face a decline in its North American revenue for the fifth consecutive quarter, although the banking and financial services sectors have posted their strongest performance since mid-2023. TCS’s communications and media vertical, a high-investment segment currently underperforming, could also benefit from potential interest rate cuts, Seksaria suggested.

Echoing CEO Krithivasan’s sentiment, Seksaria noted that the incoming U.S. administration could remove policy uncertainties and boost client confidence, further encouraging investment in discretionary tech projects. As a result, TCS’s stock saw a 5.6% increase in a single day on Friday, marking its highest rise since July 2024.

TCS also addressed concerns about the increasing trend of insourcing by multinational corporations, which may reduce the outsourcing of IT services to companies like TCS. Many global companies are expanding their in-house teams and setting up global capability centers (GCCs) in India, which is projected to reach a $105 billion market size by 2030. While this could initially offer cost advantages, Seksaria pointed out that the cyclical nature of opening and closing GCCs may pose challenges for long-term sustainability.

TCS has also managed to adapt to this shift, acquiring units such as the captive arm of Danske Bank in 2023 and Post Bank AG’s unit in 2020, indicating a flexible approach to industry changes.

 

Infosys Raises Annual Revenue Forecast on US Demand Revival

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Infosys, India’s second-largest software services exporter, has raised its annual revenue forecast for the third time this financial year, driven by a revival in U.S. demand, particularly from banking and retail clients. The company now expects its annual revenue to rise by 4.5% to 5%, an increase from its previous forecast of 3.75% to 4.5%.

This upbeat outlook mirrors the sentiments of other Indian IT giants, including Tata Consultancy Services (TCS) and HCLTech, which have also reported early signs of a recovery in discretionary spending. Infosys’ CEO, Salil Parekh, noted an improvement in the U.S. retail and consumer product industries, as challenges related to discretionary spending ease.

In the third quarter, Infosys posted a 7.6% revenue growth to 417.64 billion rupees ($4.83 billion), exceeding analyst estimates of 412.78 billion rupees. The growth was mainly driven by an uptick in revenue from North American clients, which constitute 60% of the company’s total revenue. This marks a significant recovery, as North American revenue had declined for five consecutive quarters.

Infosys also reported an 11.4% increase in profit for the quarter, reaching 68.06 billion rupees, surpassing analysts’ expectations. The company highlighted that all eight business segments saw higher growth, with the financial services division growing 6.1%. The company secured large orders worth $2.5 billion, reflecting its focus on significant deals and strategic engagements.

Gaurav Parab, an analyst at NelsonHall, noted the positive results, particularly the company’s focus on large deals and the promising developments in Agentic AI, a technology enabling AI-powered agents and bots.

 

Tim Kuniskis Rejoins Stellantis to Lead Ram Brand After CEO’s Exit

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Tim Kuniskis, a prominent Stellantis executive, is returning to the automaker with immediate effect, CNBC has confirmed. Kuniskis, who retired in May, will resume leadership of the Ram Trucks brand, according to sources familiar with the decision. The announcement, which was shared with Stellantis employees on Monday, follows the unexpected resignation of CEO Carlos Tavares just a week earlier, amid challenges in the company’s North American market.

In a statement, Stellantis emphasized that the restructuring would help the company achieve better results in the region and capitalize on the potential of the Ram brand. The company noted that having a CEO dedicated solely to Ram would be a key part of this strategy.

Kuniskis is well-regarded for his previous leadership of the Ram and Dodge brands at Stellantis. He is especially recognized for his role in bringing the high-performance Hellcat models to Dodge, helping the brand become synonymous with American muscle cars. Kuniskis also led the introduction of the Hellcat-powered Ram TRX pickup truck, further cementing his legacy as a key figure in Stellantis’ North American operations.

His return is part of broader changes within Stellantis’ North American leadership. Chris Feuell will now oversee both Chrysler and Alfa Romeo, while Jeff Kommor will focus solely on North American sales. Meanwhile, Larry Dominique, previously in charge of Alfa Romeo for North America, is set to depart.

Kuniskis’ return to Stellantis comes at a time when the company is grappling with a decline in U.S. sales, particularly for the Ram brand, which saw a 24% drop in sales through the third quarter of 2024.