Hexaware clarifies BPO layoffs as seasonal, strong Q1 amid AI push
NAVI MUMBAI, INDIA — Hexaware Technologies has set the record straight about recent workforce reductions in its BPO division, confirming the cuts were driven by seasonal demand fluctuations.
The IT services firm reported robust Q1 financial results even as it navigates the natural ebbs and flows of the BPO business while continuing strategic investments in artificial intelligence for long-term growth.
Seasonal business cycles drive BPO workforce adjustments
Hexaware Technologies reduced its BPO workforce by approximately 500 employees in Q1 2025, a move the company attributes to predictable seasonal patterns in client demand rather than automation through AI.
The clarification came after media reports suggested AI was a factor, prompting Hexaware to emphasize that such fluctuations are standard in the outsourcing industry.
While the BPO division saw reductions, Hexaware simultaneously added 100 employees in its IT services segment, demonstrating how different business units follow distinct staffing rhythms.
The firm maintains that these adjustments are part of normal operations to align resources with project pipelines.
Strong financial performance despite workforce changes
The company reported an impressive financial result in its first quarter with a 17.02% year-over-year increase. These figures underscore the company’s ability to maintain profitability while managing the inherent variability of its BPO operations.
The financial performance underlines the balanced strategy of the company, optimizing BPO operations for the current market situation while seeing further growth of the higher-margin IT services business.
This action demonstrates Hexaware’s approach and operational maturity in handling different business cycles across its service lines.
Strategic AI investments positioned for long-term impact
While distancing current layoffs from AI adoption, Hexaware reiterated its commitment to developing artificial intelligence capabilities as part of its future service offerings.
The company considers AI as an instrument for improvement for the BPO industry in the future. However, it focuses on the fact that current implementations are still in the phase of investments and trials.
The AI roadmap of Hexaware is to make operations efficient and develop higher-value services, and not to replace the workforce. The company stressed that their AI investments are meant to amplify operational efficiency and introduce new service opportunities, and not cause any loss of job opportunities.
Hexaware recently ranked #18 in the OA500 2025, an objective index of the world’s top 500 outsourcing companies.
