Cognizant to cut over 4,000 jobs as ‘Project Leap’ drives AI focus

The IT major launches a major transformation programme with increased investments in artificial intelligence and digital services, aiming to optimise costs, reshape workforce composition, and drive long-term efficiency despite subdued demand conditions.

Cognizant is set to reduce approximately 1% of its global workforce, a move expected to impact over 4,000 employees, as the IT services major recalibrates its operations amid weakening demand and a growing shift toward automation. The decision follows a recent downgrade in the company’s full-year growth outlook, signalling mounting pressure on traditional service lines.

The job cuts are part of a broader strategic overhaul under a new initiative called Project Leap, unveiled earlier this week. The programme is designed to accelerate the company’s pivot toward artificial intelligence-driven services, integrated digital solutions, and workforce reskilling. While the company has not disclosed an exact number of roles affected, leadership indicated that the restructuring may largely target mid-level positions.

AI investments drive structural shift

Project Leap will involve a substantial financial commitment, with total costs estimated between $230 million and $320 million. Of this, a significant portion—ranging from $200 million to $270 million—will be allocated toward employee severance and related expenses. However, the company expects the transformation to deliver savings of up to $300 million within the current year, reflecting a strong focus on operational efficiency.

Even as layoffs are underway, Cognizant plans to onboard over 20,000 fresh graduates in 2026, signalling a shift in workforce strategy toward entry-level talent aligned with emerging technology requirements. This dual approach highlights the company’s intent to rebalance its talent pyramid while building capabilities in next-generation digital services.

Continued workforce realignment

Despite the planned reductions, Cognizant’s overall headcount increased by around 6,000 employees, reaching 357,600 as of March 2026. This indicates that hiring in certain growth areas continues even as legacy roles are phased out.

The latest move marks the second round of layoffs under Chief Executive Officer S. Ravi Kumar, who assumed leadership in January 2023. Earlier, in May 2023, the company had laid off approximately 3,500 employees, primarily in non-billable roles, as part of initial cost-optimisation efforts.

The broader technology sector has also witnessed significant workforce reductions, particularly in April, when more than 40,000 jobs were cut globally. Major firms such as Oracle, Snap, and Meta have announced similar restructuring measures, driven by increased automation and higher investments in artificial intelligence.

Cognizant’s latest restructuring underscores an industry-wide transition, as companies balance cost pressures with the need to invest in future-ready technologies.