Bengaluru, 14 April
DBT Bureau
Artificial intelligence (AI) and Generative AI are increasingly boosting the deal pipeline of IT services companies. In the fourth quarter (Q4) of FY24, India’s largest IT services provider, TCS saw outsourcing contracts worth around $900 million coming from AI and Gen AI space.
“We have won more than 200 engagements in AI so far this year. The number of engagements going into production is steadily increasing. Our AI and Generative AI pipeline has doubled in the quarter to USD 900 million,” K Krithivasan, CEO & MD of TCS said at the post results press conference.
The company management also said that more AI and Gen AI deals were not cannibalizing contracts from traditional technology areas, but rather supplementing it.
“AI deals … are not eating into the other typical spend that we do. Most of the AI deals are typically embedded into the large transformation programmes or efficiency programmes that we undertake,” N Ganapathy Subramaniam, the Chief Operating Officer at TCS said.
The outgoing COO also highlighted that most AI deals were embedded within these programmes, focusing on improving decision-making processes and enhancing efficiencies for both customers and internal departments.
TCS recently announced that it has trained over 350,000 employees in AI & ML, including Gen AI. TCS is also a launch partner for the newly announced AWS Generative AI Competency.
Accenture is the only global IT firm, which had earlier provided its revenue estimate from Gen AI deals. The company bagged deals worth $450 million in the Gen AI segment during the September-November quarter or the first quarter of FY24. Accenture follows September-August financial year cycle.
Gen AI has taken the technology industry by storm as it is changing the ways many processes are currently being conducted. Through intelligent automation, many tasks of enterprises can be fully done through automation, replacing human workers.
However, despite all the buzz, revenue contribution of Gen AI to the global IT industry remains low. Most Indian IT companies have not provided any estimate of revenue contribution though TCS for the first time has provided deal value coming from both AI and Gen AI.
Experts believe that Gen AI could be a game-changer in the coming quarters as more enterprises implement these solutions.
