Top global companies are reducing the number of IT vendors they work with and consolidating services among fewer partners to cut costs amid uncertainty over U.S. trade policies. This trend of “vendor consolidation deals” is proving beneficial to major Indian IT firms like Infosys and Cognizant. Infosys CFO Jayesh Sanghrajka and Financial Controller Sandeep Mahindroo highlighted that vendor consolidation is a key focus, especially in a market where net new deals are scarce. Similarly, Cognizant’s Americas President Surya Gummadi noted that while clients may not aim directly for consolidation, their broader goal of cost optimization is leading them to reduce vendor count and focus on value-driven partnerships.
Cognizant and Infosys Show Mixed Growth Amid Vendor Consolidation Trends
Despite this shift, neither company has reported significant client spend reductions or project cancellations. Cognizant, headquartered in New Jersey but employing most of its workforce in India, has seen growth driven mainly by acquisitions. Cognizant closed 2024 with $19.74 billion in revenue (up 1.98%) and has won two major deals in 2025, including one exceeding $1 billion. It now projects 6.4% growth for 2025, expecting to reach $21 billion in revenue.
Infosys, India’s second-largest IT services company, posted $19.28 billion in FY25 revenue, a 3.85% increase. However, it saw a 34% decline in large deal value, signalling possible headwinds in future growth. Its FY26 revenue guidance of flat to 3% growth is the lowest starting projection since 2009.
Mixed Performance Across Indian IT Firms as Market Shifts Continue
Other major Indian IT firms are seeing mixed results. TCS reported 3.78% revenue growth to $30.18 billion, and HCLTech led growth with a 4.3% rise to $13.84 billion. On the downside, Wipro and Tech Mahindra reported declines of 2.72% and 0.21% respectively.
Analysts remain cautiously optimistic about Infosys, citing its strong positioning in vendor consolidation, cost optimization, and AI, despite its exposure to non-essential tech spending making it more vulnerable to pullbacks.
Summary:
Amid U.S. trade uncertainty, global firms are consolidating IT vendors to cut costs, benefiting Indian giants like Infosys and Cognizant. While Cognizant projects strong 2025 growth, Infosys faces deal slowdowns. TCS and HCLTech saw gains, but Wipro and Tech Mahindra reported declines. Analysts remain cautiously optimistic about Infosys’s positioning.
