Rising Threats from Flawed AI, Deepfakes, and Geopolitical Tensions Pose Significant Risks to Global Business, Warns Wipro

Wipro Flags AI Adoption Risks in FY26 Annual Report

IT major Wipro has identified the rapid adoption of Artificial Intelligence (AI) as a major risk factor, citing flawed algorithms, biases, and evolving regulations as potential threats to its business. According to Wipro's FY26 annual report, the company is increasingly integrating generative and autonomous AI into its client offerings and internal operations, but notes that the technology remains "uncertain and evolving".

Wipro's caution stems from the potential for unintended outcomes when AI systems operate with limited human intervention. The company warns that deficiencies in AI solutions could lead to project delays, failure to meet contractual service levels, disputes, and ultimately, the loss of business. Furthermore, the rise of AI automation, improved efficiency, and independent client tools could lower demand for certain core services, potentially hurting prices, profit margins, service levels, and the mix of services offered by the firm.

In addition to operational AI risks, Wipro highlighted the growing menace of highly sophisticated cyber threats. The company notes that the malicious use of advanced AI models to create deepfakes and AI-generated social engineering has significantly expanded the threat landscape, making the company and its third-party vendors vulnerable to data breaches and ransomware attacks.

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Wipro also underscored the impact of macroeconomic and geopolitical uncertainties on its growth. The company noted that recent and continued geopolitical changes, including changes in tariffs and trade policies, could lead to supply-chain disruptions, inflationary pressures, and reduced business confidence. This, in turn, could prompt clients to delay, reduce, or reprioritise their discretionary technology spending.

The company's reliance on international markets also poses risks. Wipro derives approximately 62 per cent of its IT services revenue from the Americas and 27 per cent from Europe, and notes that ongoing conflicts in the Middle East, South Asia, and between Russia and Ukraine could lead to supply-chain disruptions, inflationary pressures, and reduced business confidence.

Finally, Wipro warned that rising wage costs in India could diminish its historical competitive advantage against tech firms in the US and Europe, potentially squeezing profit margins.

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