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Tempus AI's Diagnostics and Data Arms Drive Long-Term Growth Story
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Key Takeaways
Markets often fall during wars but later recover as economies adjust and policy support is introduced.
Defense, energy and commodities often perform better during conflicts due to spending and demand shifts.
Gold, commodities and crypto can act as hedges or alternative assets during geopolitical uncertainty.
Tempus AI (TEM - Free Report) sits at the intersection of diagnostics, data and artificial intelligence. The company is building a precision medicine platform designed to help physicians, researchers and drug developers make more informed decisions.
In 2025, Tempus generated $1.27 billion in revenues, reflecting strong growth across both Diagnostics and Data and Applications. The story for investors is no longer just about building scale. It is increasingly about pricing leverage, data monetization and a path toward improved adjusted profitability.
TEM's Precision Medicine Platform
Tempus aggregates and structures multimodal data from clinical care and laboratory testing. It then applies artificial intelligence to turn that data into actionable insights for physicians, researchers, payers and biopharmaceutical companies.
The operating model spans two revenue lines. Genomics includes oncology testing and hereditary testing. Data and services commercializes de-identified datasets, clinical trial services and analytics for life sciences partners.
Genomics revenues are generated through diagnostic and profiling assays that support therapy selection and disease monitoring. Data and services revenues are tied to licensing insights, trial matching and contract research operations that support oncology studies. Most revenue is generated in North America.
Tempus AI's Diagnostics Revenue Drivers
Diagnostics is the larger engine. In 2025, Diagnostics generated $955.4 million, representing about 75% of total revenue.
Within oncology, Tempus offers DNA-based xT testing, liquid biopsy xF, RNA-based xR testing and other molecular pathology services. These assays help guide therapy decisions and monitor disease progression.
Hereditary testing adds another growth layer. The February 2025 acquisition of Ambry Genetics expanded inherited cancer risk testing and rare disease panels. In the fourth quarter of 2025, Diagnostics revenues rose 121.6% year over year, driven by 29% Oncology volume growth and 23% Hereditary volume growth. For the full year, Diagnostics revenues increased 111.5%, underscoring broad-based momentum.
Tempus AI's Data and Applications: How It Monetizes Demand
The second engine is Data and Applications, which generated $316.4 million in 2025, or roughly 25% of total revenues. This segment includes Insights data licensing, clinical trial support and matching, and contract research operations.
In the fourth quarter of 2025, Data and Applications revenues reached $100.4 million, up 25.1% year over year. Insights revenues grew 69.5%, excluding the prior-year impact of the AstraZeneca warrant. Tempus ended 2025 with more than $1.1 billion in Total Remaining Contract Value and reported Net Revenue Retention of 126%, signaling expansion within the installed base.
Tempus AI's AI Tools Extend Beyond Testing
Tempus is also building AI applications that extend beyond core testing. Tempus Next is designed for care gap identification, helping providers flag patients who may benefit from additional interventions. Tempus Pixel is an imaging platform that integrates artificial intelligence into diagnostic workflows.
Regulatory milestones support broader use cases. The company has received 510(k) clearance for xR IVD and updates to Pixel and ECG-Low ejection fraction software. Regulatory clearance matters because it enables clinical deployment and strengthens positioning with life sciences partners.
Recent updates also include the launch of an AI-driven HRD-RNA model and an imaging collaboration to enhance lung cancer screening through Pixel. These initiatives reinforce the platform approach rather than a single-test model.
Tempus AI's Key Investor Watch Items
For investors, three variables stand out. First is pricing and reimbursement progress. The company is migrating tests through regulatory pathways, including shifting xT CDx volume to the FDA-approved version, and has submitted xF to the FDA. The pace of approvals and payer adoption will influence average selling prices over time.
Second is the conversion of contracted data value into recognized revenues. Multi-year contracts provide visibility, but revenue recognition can be uneven quarter to quarter.
Third is operating leverage. Adjusted EBITDA is improving, but GAAP losses remain elevated due to stock-based compensation and acquisition-related costs. Investors will be watching whether revenue growth across Diagnostics and Data and Applications continues to translate into sustained margin expansion.
Tempus currently carries a Zacks Rank #4 (Sell), reflecting near-term earnings estimate trends. For comparison, 10x Genomics (TXG - Free Report) , holding a Zacks Rank #3 (Hold), operates in genomic tools, while iRhythm Holdings, Inc. (IRTC - Free Report) , also carrying a Zacks Rank #3, focuses on digital cardiac monitoring. As Tempus scales both engines, the durability of growth and pricing gains will likely determine whether sentiment shifts.
View the Zacks #1 Rank List
Image: Bigstock
Tempus AI's Diagnostics and Data Arms Drive Long-Term Growth Story
Key Takeaways
Tempus AI (TEM - Free Report) sits at the intersection of diagnostics, data and artificial intelligence. The company is building a precision medicine platform designed to help physicians, researchers and drug developers make more informed decisions.
In 2025, Tempus generated $1.27 billion in revenues, reflecting strong growth across both Diagnostics and Data and Applications. The story for investors is no longer just about building scale. It is increasingly about pricing leverage, data monetization and a path toward improved adjusted profitability.
TEM's Precision Medicine Platform
Tempus aggregates and structures multimodal data from clinical care and laboratory testing. It then applies artificial intelligence to turn that data into actionable insights for physicians, researchers, payers and biopharmaceutical companies.
The operating model spans two revenue lines. Genomics includes oncology testing and hereditary testing. Data and services commercializes de-identified datasets, clinical trial services and analytics for life sciences partners.
Genomics revenues are generated through diagnostic and profiling assays that support therapy selection and disease monitoring. Data and services revenues are tied to licensing insights, trial matching and contract research operations that support oncology studies. Most revenue is generated in North America.
Tempus AI's Diagnostics Revenue Drivers
Diagnostics is the larger engine. In 2025, Diagnostics generated $955.4 million, representing about 75% of total revenue.
Within oncology, Tempus offers DNA-based xT testing, liquid biopsy xF, RNA-based xR testing and other molecular pathology services. These assays help guide therapy decisions and monitor disease progression.
Hereditary testing adds another growth layer. The February 2025 acquisition of Ambry Genetics expanded inherited cancer risk testing and rare disease panels. In the fourth quarter of 2025, Diagnostics revenues rose 121.6% year over year, driven by 29% Oncology volume growth and 23% Hereditary volume growth. For the full year, Diagnostics revenues increased 111.5%, underscoring broad-based momentum.
Tempus AI, Inc. Price and Consensus
Tempus AI, Inc. price-consensus-chart | Tempus AI, Inc. Quote
Tempus AI's Data and Applications: How It Monetizes Demand
The second engine is Data and Applications, which generated $316.4 million in 2025, or roughly 25% of total revenues. This segment includes Insights data licensing, clinical trial support and matching, and contract research operations.
In the fourth quarter of 2025, Data and Applications revenues reached $100.4 million, up 25.1% year over year. Insights revenues grew 69.5%, excluding the prior-year impact of the AstraZeneca warrant. Tempus ended 2025 with more than $1.1 billion in Total Remaining Contract Value and reported Net Revenue Retention of 126%, signaling expansion within the installed base.
Tempus AI's AI Tools Extend Beyond Testing
Tempus is also building AI applications that extend beyond core testing. Tempus Next is designed for care gap identification, helping providers flag patients who may benefit from additional interventions. Tempus Pixel is an imaging platform that integrates artificial intelligence into diagnostic workflows.
Regulatory milestones support broader use cases. The company has received 510(k) clearance for xR IVD and updates to Pixel and ECG-Low ejection fraction software. Regulatory clearance matters because it enables clinical deployment and strengthens positioning with life sciences partners.
Recent updates also include the launch of an AI-driven HRD-RNA model and an imaging collaboration to enhance lung cancer screening through Pixel. These initiatives reinforce the platform approach rather than a single-test model.
Tempus AI's Key Investor Watch Items
For investors, three variables stand out. First is pricing and reimbursement progress. The company is migrating tests through regulatory pathways, including shifting xT CDx volume to the FDA-approved version, and has submitted xF to the FDA. The pace of approvals and payer adoption will influence average selling prices over time.
Second is the conversion of contracted data value into recognized revenues. Multi-year contracts provide visibility, but revenue recognition can be uneven quarter to quarter.
Third is operating leverage. Adjusted EBITDA is improving, but GAAP losses remain elevated due to stock-based compensation and acquisition-related costs. Investors will be watching whether revenue growth across Diagnostics and Data and Applications continues to translate into sustained margin expansion.
Tempus currently carries a Zacks Rank #4 (Sell), reflecting near-term earnings estimate trends. For comparison, 10x Genomics (TXG - Free Report) , holding a Zacks Rank #3 (Hold), operates in genomic tools, while iRhythm Holdings, Inc. (IRTC - Free Report) , also carrying a Zacks Rank #3, focuses on digital cardiac monitoring. As Tempus scales both engines, the durability of growth and pricing gains will likely determine whether sentiment shifts.
You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.