TEM's Genomics revenues soar 89% on oncology test gains and Ambry Genetics' boost. New assays could fuel more growth.
TEM expands major partnerships with AZN, ILMN, and PSNL, fueling AI-driven R&D and widening its precision medicine reach.
Tempus AI TEM surged 12.5% in the first week of June, outperforming the broader market and the benchmarks by a wide margin. This rally came largely on the heels of investors' positive reaction to two back-to-back innovations from the company.
TEM is a data-rich platform that recently clinched a $200 million deal with AstraZeneca. TEM's main bet is now on AI for healthcare applications. I believe TEM's main business moat is its vast and rapidly growing data, which can be leveraged for AI. This is how TEM has sustained its impressive revenue growth. For example, it's integrating Ambry and Deep 6 to expand hereditary testing and add millions of records to its dataset. This strengthens Tempus AI's use cases.
TEM's rapid growth and cost discipline are paving the way for a positive adjusted EBITDA in 2025.
Tempus AI delivered strong Q1 results, driven by the Ambry Genetics acquisition and a major AstraZeneca contract, boosting revenue and backlog. The AI precision medicine company grew core revenues 32% YoY, but headline growth topped 75% due to the Ambry deal, though organic growth analysis is crucial for investors. The stock trades at a reasonable 7x '26 sales with 25-28% pro forma growth, but limited adjusted EBITDA targets may cap the valuation premium.
I initiate coverage of Tempus AI, Inc. with a Buy rating, driven by its unique data assets and AI-powered oncology solutions. The company posted strong revenue growth and margin expansion, though profitability and high debt remain concerns as it integrates recent acquisitions. Tempus AI's vast clinical and molecular data, validated at major conferences, positions it as a key partner for leading pharma and healthcare companies.
Tempus AI, Inc. is growing rapidly in healthcare tech, especially genomics, but is not yet profitable and carries significant risk. Recent revenue growth is boosted by the Ambry Genetics acquisition; organic growth remains strong, but future growth may slow post-acquisition. The company benefits from exposure to large, expanding markets and leverages AI/data partnerships, but faces high valuation multiples.
President Donald Trump's new executive order aiming to cut U.S. drug prices could benefit Tempus AI.
Tempus AI, Inc. (NASDAQ:TEM ) Q1 2025 Earnings Conference Call May 6, 2025 4:30 PM ET Company Participants Liz Krutoholow – Vice President-Investor Relations Eric Lefkofsky – Founder and Chief Executive Officer Jim Rogers – Chief Financial Officer Conference Call Participants Tejas Savant – Morgan Stanley Ryan MacDonald – Needham & Company Mark Schappel – Loop Capital Subbu Nambi – Guggenheim Daniel Brennan – TD Cowen Mark Massaro – BTIG Michael Ryskin – Bank of America Rachel Vatnsdal – JPMorgan Dan Arias – Stifel Operator Good day everyone. And thank you for standing by.
Tempus AI (NASDAQ: TEM), a fast-rising player in clinical AI and health data infrastructure, will report its Q1 2025 earnings after the market closes today.
TEM's Genomics unit is expected to report strong growth for the first quarter, banking on continued unit growth pick-up.