IT companies see shift in deal scope on GenAI, muted market

Indian software services firms are experiencing a shift in their scope of contractual work following client expectations of enhanced productivity from generative AI or due to global macro uncertainties. Such contractual revisions can potentially erode margins at these companies, experts say.

At least three top IT firms – Infosys, Tata Consultancy Services, and HCLTech spoke about either changes in the scope of clients’ contracts or passing productivity benefits to clients by doing the same amount of work for lower price in the last two quarters.