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What's Driving TEM Data and Applications Arm's Robust Growth?
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Key Takeaways
Tempus AI's Data and Applications segment saw 69.5% Insights growth exiting 2025, boosting momentum.
TEM reported $1.1B contract value and 126% net retention, showing strong customer expansion trends.
AI investments and new data types like radiology and cardiology are expanding TEM's market reach.
Tempus AI’s (TEM - Free Report) Data and Applications segment has emerged as a central pillar of the company’s business, which is built on two main components — data licensing (Insights) and a growing suite of software-driven applications.
The Data and Applications business delivered strong momentum exiting 2025, with Insights growing 69.5%, excluding the prior-year impact of the AstraZeneca warrant in the fourth quarter of 2025. Total contract value exceeded $1.1 billion, while net revenue retention was 126%. These metrics support the view that existing customers are expanding over time.
Management expects approximately $1.59 billion in 2026 revenues, implying roughly 25% growth, which keeps the medium-term data conversion story intact even if revenue recognition remains staged.
A key driver of future growth is Tempus’ investment in artificial intelligence (AI), particularly its development of large-scale foundation models trained on proprietary datasets. These models are expected to deliver increasingly advanced insights across oncology and other medical fields, strengthening both the licensing and application businesses. Expansion into data types such as radiology, cardiology, and neuropsychology increases the addressable market and opens up cross-selling opportunities.
Peer Update
SOPHiA GENETICS (SOPH - Free Report) continued to scale its data platform, driven by increased usage from existing customers as well as strong new customer additions. In 2025, the company performed a record of more than 391,000 analyses on its SOPHiA DDM platform.
Growth momentum was further supported by the addition of 30 new customers in the fourth quarter of 2025, including leading institutions such as NYU Langone Health in the United States, AZ Delta in Belgium, the Human Genome & Stem Cell Research Center in Brazil, and Tyrolpath, one of Austria’s largest pathology laboratories. The company also deepened engagement with existing customers, with net dollar retention rising to 115% in 2025 as customer churn continued to decline.
ICON’s (ICLR - Free Report) digital innovation strategy is central to enhancing clinical trial delivery through AI and advanced technologies. The company introduced two AI-enabled tools — iSubmit, which automates clinical trial document management via electronic trial master files, and SmartDraft, which streamlines contract drafting to accelerate study startup timelines.
ICON has also upgraded its digital platform to support patient-centric, decentralized trials, incorporating tools like the Firecrest portal (for site training and communication) and the Mapi Research Trust’s clinical outcomes assessment library. These capabilities are reflected in ICON’s recognition as a top-performing contract research organization for Phase 1 trials in an Industry Standard Research (“ISR”) benchmarking report.
TEM Stock Outperforms Industry & Benchmark
Over the past year, Tempus AI’s shares have gained 11%, outperforming the industry’s 20.9% decline. The S&P 500 composite has improved 33.9% over the said period.
Image Source: Zacks Investment Research
Discounted Valuation
TEM currently trades at a forward 12-month Price-to-Sales (P/S) of 5.00X compared with the industry median of 5.38X.
Image Source: Zacks Investment Research
TEM Stock Estimate Trend
Over the past 30 days, Tempus AI's loss per share estimate for 2026 has remained unchanged at 34 cents.
View the Zacks #1 Rank List
Image: Bigstock
What's Driving TEM Data and Applications Arm's Robust Growth?
Key Takeaways
Tempus AI’s (TEM - Free Report) Data and Applications segment has emerged as a central pillar of the company’s business, which is built on two main components — data licensing (Insights) and a growing suite of software-driven applications.
The Data and Applications business delivered strong momentum exiting 2025, with Insights growing 69.5%, excluding the prior-year impact of the AstraZeneca warrant in the fourth quarter of 2025. Total contract value exceeded $1.1 billion, while net revenue retention was 126%. These metrics support the view that existing customers are expanding over time.
Management expects approximately $1.59 billion in 2026 revenues, implying roughly 25% growth, which keeps the medium-term data conversion story intact even if revenue recognition remains staged.
A key driver of future growth is Tempus’ investment in artificial intelligence (AI), particularly its development of large-scale foundation models trained on proprietary datasets. These models are expected to deliver increasingly advanced insights across oncology and other medical fields, strengthening both the licensing and application businesses. Expansion into data types such as radiology, cardiology, and neuropsychology increases the addressable market and opens up cross-selling opportunities.
Peer Update
SOPHiA GENETICS (SOPH - Free Report) continued to scale its data platform, driven by increased usage from existing customers as well as strong new customer additions. In 2025, the company performed a record of more than 391,000 analyses on its SOPHiA DDM platform.
Growth momentum was further supported by the addition of 30 new customers in the fourth quarter of 2025, including leading institutions such as NYU Langone Health in the United States, AZ Delta in Belgium, the Human Genome & Stem Cell Research Center in Brazil, and Tyrolpath, one of Austria’s largest pathology laboratories. The company also deepened engagement with existing customers, with net dollar retention rising to 115% in 2025 as customer churn continued to decline.
ICON’s (ICLR - Free Report) digital innovation strategy is central to enhancing clinical trial delivery through AI and advanced technologies. The company introduced two AI-enabled tools — iSubmit, which automates clinical trial document management via electronic trial master files, and SmartDraft, which streamlines contract drafting to accelerate study startup timelines.
ICON has also upgraded its digital platform to support patient-centric, decentralized trials, incorporating tools like the Firecrest portal (for site training and communication) and the Mapi Research Trust’s clinical outcomes assessment library. These capabilities are reflected in ICON’s recognition as a top-performing contract research organization for Phase 1 trials in an Industry Standard Research (“ISR”) benchmarking report.
TEM Stock Outperforms Industry & Benchmark
Over the past year, Tempus AI’s shares have gained 11%, outperforming the industry’s 20.9% decline. The S&P 500 composite has improved 33.9% over the said period.
Image Source: Zacks Investment Research
Discounted Valuation
TEM currently trades at a forward 12-month Price-to-Sales (P/S) of 5.00X compared with the industry median of 5.38X.
Image Source: Zacks Investment Research
TEM Stock Estimate Trend
Over the past 30 days, Tempus AI's loss per share estimate for 2026 has remained unchanged at 34 cents.
Image Source: Zacks Investment Research
TEM stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.