Cognizant plans to cut up to 15,000 jobs globally as Project Leap drives AI transformation

Cognizant Could Cut Up to 15,000 Jobs Globally Amid AI-Led Restructuring

Cognizant is said to be considering a major workforce reduction globally. In recent months, layoffs across the tech industry have accelerated, leading tech firms like Amazon, Meta, and Oracle to announce drastic workforce reductions. Cognizant, an IT consulting and outsourcing company, is reportedly the latest among them to plan significant job cuts affecting thousands of employees globally. India is expected to bear the brunt of the restructuring. The move comes amid continued structural changes in the global technology sector due to AI adoption. Cognizant Reportedly Planning Major Layoffs According to a report by Moneycontrol, Cognizant could reduce its global workforce by around 12,000 to 15,000 employees. Citing sources familiar with the matter, the report states that most of these layoffs are expected to affect employees in India, a market where the company has over 2.5 lakh workers out of its global workforce of more than 3.57 lakh employees. Calculations tied to severance costs disclosed by Cognizant during its quarterly earnings announcement on April 29 are said to have led to this estimate. At the time, the company reportedly mentioned it expects to incur between $230 million (roughly Rs. 2,185.9 lakh crore) and $320 million (roughly Rs. 3,041.3 lakh crore) in severance-related expenses. The aforementioned figures were reportedly under a restructuring initiative called Project Leap. The company, however, did not disclose the exact number of affected employees. Sources cited in the report further suggest that the estimate is based on average salary and severance assumptions across different regions. In markets like India, the average annual salaries are lower compared to markets like the US. This reportedly means the same restructuring budget could affect a larger number of employees. Industry executives quoted in the report said clients are increasingly moving away from traditional pyramid-heavy staffing structures, where large teams of junior employees typically support smaller groups of senior staff. According to one executive, customers are no longer willing to fund training-heavy fresher hiring models. Cognizant CEO Ravi Kumar S also hinted at these changes during the company's earnings interaction, describing the restructuring as a "global programme." He reportedly said the company is moving towards a "broader and shorter pyramid" model that combines "digital labour and human labour." The IT consulting and outsourcing company is the latest among the tech firms to be weighing layoffs. According to a report, March 2026 could have been the worst month for tech workers, seeing the highest number of layoffs in the past two years. Nearly 92,300 tech workers were laid off between January 1 and April 20 this year, with March alone accounting for around 38,000 job cuts, which is reportedly the highest monthly total in the past two years. Several major companies, including Oracle and Meta, also announced workforce reductions amid growing investments in AI infrastructure and leaner organisational structures.

Meta, Amazon, Oracle & Cognizant: AI layoffs are spreading faster than expected

The AI-driven layoff wave is widening across global tech, and Cognizant may soon join the list of companies cutting jobs amid an industry-wide reset. The IT major is reportedly considering layoffs of up to 15,000 employees globally, with India expected to bear a significant share of the impact.The move comes as tech firms grapple with slower client spending, and a rapid shift towards AI-led delivery models. Cognizant joins a growing list of firms, including TCS, Accenture, HCLTech, Oracle, and Meta, that have announced workforce reductions or restructuring plans linked to AI adoption and cost optimisation.

Cognizant Sets Aside $270 Million For Layoffs In 'Project Leap' AI Operating Model Plan

'We are on the journey to get to the operating model,' says Cognizant CEO Ravi Kumar S. Cognizant plans to spend upward of $270 million on employee severance and other personnel-related costs as part of layoffs under its "Project Leap" initiative to become more agile and enable an artificial intelligence-enabled operating model. The Teaneck, N.J.-based company-No. 7 on CRN's 2025 Solution Provider 500-detailed the plan during its latest quarterly earnings call. Cognizant could cut as many as 15,000 jobs globally, with most of those in India, according to India-based business news provider Moneycontrol. Cognizant has more than 357,000 employees. "We are on the journey to get to the operating model," Cognizant CEO Ravi Kumar S said on the call, according to a transcript. "Leap is to make sure that we get there fast. It's our opportunity to resize our (talent) pyramid with a broader parameter. That's why we're hiring more school graduates, more early careers. And (go shorter) on the height of the pyramid so that you get to expertise much faster. That's our model." [RELATED: Atlassian Plans 1,600 Layoffs With Savings Shift To AI, Enterprise Sales] CRN has reached out to Cognizant for comment. Project Leap should deliver savings in 2026 of about $200 million to $300 million, Cognizant Chief Financial Officer Jatin Dalal said on the earnings call, held Wednesday and covering the three months ended March 31. Cognizant will see a full year of savings in 2027 and plans to reinvest a third of the savings into upscaling its workforce while exploring mergers and acquisitions. Indeed, Cognizant revealed on the same day as its latest quarterly earnings report that it plans to buy AI-first IT managed services provider Astreya Partners for about $600 million. The acquisition should close in Cognizant's second quarter and add capabilities around data center buildouts with an outcome-based model. Two-thirds of Project Leap's savings will support future growth across integrated offerings, AI capabilities and partnerships, the executives said on the earnings call. Cognizant raised its 2026 adjusted operating margin guidance range to between 16 percent and 16.2 percent thanks to the expected savings. Dalal said that Project Leap should cost Cognizant a total of $230 million to $320 million. Cognizant should need a "couple of months" for completing Project Leap, with effects felt for another three to four months, Kumar said on the call. Cognizant sees an opportunity in the AI era helping large enterprises transform processes even in highly regulated industries to increase value. The AI era doesn't mean a pause on headcount, with Kumar pointing to around 20,000 new hires in 2025 and a higher number expected in 2026. Cognizant is rethinking its traditional "pyramid" approach to talent to develop more interdisciplinary AI-augmented teams, Kumar said. Cognizant has an "AI builder" career program mapping every role in the solution provider to a future-ready AI job family with defined pathways and targeted learning plans. "The Leap program reinforces our commitment to be in the winner circle of revenue growth and supports our journey of expanding margins," the CEO said. "To win, we must move fast and stay agile, which is exactly why Project Leap is so critical." As a trend, AI is pushing toward a repricing of labor-intensive IT services, Bernstein said in a report in April. Firms are moving from labor-based delivery models to agent-driven, platform-led, outcome-based services-a services-as-software model. They are compressing the delivery pyramid and moving more into a diamond structure, with AI and automation taking over coding, testing documentation and level one and level two support, according to the investment firm. Instead, humans are handling oversight, quality control, product and service design and other high-value work. Firms that keep productivity gains through intellectual property platforms and managed operations are the ones getting rewarded, according to Bernstein. Cognizant is among the small number of solution providers partnered with not only Claude maker Anthropic, but its rivalChatGPT maker OpenAI as the two AI upstarts build out their channel partner programs and go deeper into enterprise sales. Kumar said on the earnings call that token metering is now a reality for projects, both for fixed-price programs and for time and material billing. Cognizant can leverage AI for reducing its own costs for completing a project, increasing the margin. Kumar said that at this point, nearly 40 percent of its code is AI assisted. For time-and-material, Cognizant is using tokenized rate cards, with clients responsible for digital effort and Cognizant responsible for human effort. But the solution provider sees customers coming back to ask Cognizant to handle both for better optimization and cost management. "We are ahead on the curve, both to take the accountability of digital and human labor for ourselves or if clients want to take the accountability for themselves," he said. Cognizant met expectations on revenue reported on its latest quarterly earnings call in April, according to a William Blair report. The investment firm said that the solution provider did underperform in gross margin and in forecasted second-quarter revenue. The company's executives said to expect between 3.2 percent and 4.7 percent growth in the second fiscal quarter ignoring foreign exchange, taking "a more cautious near-term view of discretionary spending based on recent global events and trends," the CFO said. It still expects full year revenue growth of 4 percent to 6.5 percent ignoring foreign exchange. Cognizant reported $5.4 billion in revenue for its first fiscal quarter, up 3.9 percent year on year ignoring foreign exchange. About 90 basis points from recent acquisition 3Cloud and large deal ramp-ups in North America and financial services helped with growth. The financial services business grew 10 percent year on year ignoring foreign exchange. Health sciences was weaker than expected, however, falling about 1 percent year on year. Bookings grew 21 percent year on year for the quarter and 11 percent for the trailing 12 months. Softer small discretionary projects led to flat annual contract value (ACV) year on year, but Cognizant did land seven large deals of more than $100 million in total contract value (TCV). Cognizant had 5,000-plus AI engagements exiting the quarter, up from 4,000 in December, showing accelerating AI demand. Since the earnings call, Cognizant's stock has fallen about 5 percent, trading at about $52 a share. William Blair was still bullish on Cognizant, saying in its report that the company shows consistent growth and profitability driven by an AI-focused strategy, improved operational execution and growing demand in key verticals. Cognizant-alongside Accenture, Deloitte and Infosys-was singled out as a system integrator with a deep Anthropic investment and strong platform-ization that could monetize agentic AI in regulated and complex workflows in an April report by Bernstein. Cognizant isn't alone in pursuing layoffs in 2026 as the battle for AI dominance heats up. Other vendors that have announced or conducted layoffs so far this year include Atlassian, Amazon Web Services, Autodesk and Kaseya.