Tempus AI, Inc. Class A (TEM) AI Stock Analysis

• Market Cap: $9.44B
• Dividend Yield: N/A
• Average Volume (3M): 5.57M
• Price to Earnings (P/E): ―
• Beta (1Y): 3.12
• Revenue Growth: 72.58%
• EPS Growth: 76.81%
• Country: US
• Employees: 2,400
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Information Services
• EPS (TTM): -0.04
• Shares Outstanding: 172,863,460
• 10 Day Avg. Volume: 6,744,673
• 30 Day Avg. Volume: 5,568,178
• PEG Ratio: 0.61
• Price to Book (P/B): 20.94
• Price to Sales (P/S): 8.09
• P/FCF Ratio: -43.03
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 7.27
• Enterprise Value/Gross Profit: 10.44
• Enterprise Value/Ebitda: -41.58
• 1Y Price Target: $78.23
• Price Target Upside: 47.46% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14
• EPS Forecast (FY): -0.39
• Revenue Forecast (FY): $1.59B

• Rating: 49 Neutral
• Price Target: $53.00 ▼(-0.09% Downside)
• Action: Reiterated Date: 02/26/26
• Date: Action: Reiterated 02/26/26

The score is held back primarily by weak financial quality (ongoing losses and material cash burn) and bearish technicals (price below major moving averages with negative MACD). Offsetting these, the latest earnings call was notably positive with strong 2026 growth and adjusted EBITDA guidance plus solid Diagnostics/Data indicators, but valuation is hard to justify on earnings due to the negative P/E.

Positive Factors

Revenue & Margin Improvement

Sustained revenue acceleration and a meaningful gross margin lift indicate improving unit economics and operating leverage. Over a multi-quarter horizon, higher margins reduce reliance on scale for profitability and make the path to sustained adjusted EBITDA and cash generation more achievable if growth persists.

Data Business Momentum & Contract Backlog

A >$1.1B contract backlog and 126% net revenue retention provide durable revenue visibility and expansion potential from existing customers. Large TCV and high NRR support recurring, higher‑margin revenues that compound over time and strengthen predictability versus one‑off diagnostics volumes.

Technology, Models & Product Platform

Significant on‑prem compute, foundation‑model development, and multimodal product launches (pathology, MRD, whole‑genome) build structural competitive advantages. Proprietary models + data create switching costs, support differentiated products, and enable price/margin expansion over multiple years.

Negative Factors

Persistent Cash Burn

Consistent negative operating and free cash flow increases dependence on external financing and raises execution risk. Until cash conversion improves, the company must manage capital allocation carefully; funding needs can constrain R&D, go‑to‑market expansion, or strategic optionality over 2–6 months.

Sizeable Debt and Leverage

Material debt levels limit financial flexibility for a business that is not yet consistently profitable. Interest and principal obligations heighten refinancing risk and reduce capital available for growth initiatives, particularly if cash generation lags or market conditions tighten.

Regulatory/Reimbursement Gating (MRD)

MRD represents large upside but is structurally gated by reimbursement reviews and assay iterations. Payer/regulatory timing and a pivot to a second‑gen assay create durable uncertainty that can materially delay high‑margin volume realization and margin improvement in upcoming quarters.

Tempus AI, Inc. Class A Business Overview & Revenue Model

Company Description

Tempus AI, Inc. operates as a healthcare technology company. It engages in providing next generation sequencing diagnostics, polymerase chain reaction profiling, molecular genotyping, and other anatomic and molecular pathology testing to healthcare providers, pharmaceutical companies, biotechnology companies, researchers, and other third parties. The company offers Insights, a license library of linked clinical, molecular, and imaging de-identified data, as well as a suite of analytical services to analytic and cloud-and-compute tools to pharmaceutical and biotechnology companies; and Trials that provides clinical trial matching services to pharmaceutical companies. In addition, it operates Next; Algos, a suite of algorithmic tests in oncology; Hub, a desktop and mobile platform for ordering, managing, and receiving tests and patient results; and Lens, a platform for researchers and scientists to find, access, and analyze Tempus data. The company has a strategic collaborations agreement with AstraZeneca and Pathos AI, Inc. to develop therapeutic programs in oncology. The company was formerly known as Tempus Labs, Inc. and changed its name to Tempus AI, Inc. in January 2023. Tempus AI, Inc. was incorporated in 2015 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Tempus AI generates revenue primarily through the sale of its AI-driven software solutions and analytics services. The company's revenue model includes subscription-based pricing for its software platforms, which provides clients with ongoing access to updates and support. Additionally, Tempus AI offers consulting services that help organizations integrate AI technologies into their operations, creating another significant revenue stream. Key partnerships with healthcare providers and financial institutions also contribute to its earnings, as these collaborations often lead to long-term contracts and joint ventures that expand the company's market reach.

Tempus AI, Inc. Class A Financial Statement Overview

Summary

Operating progress is mixed: revenue growth and gross margin improved meaningfully, and leverage improved as equity rebuilt. However, the company remains unprofitable with sizable net losses and persistent cash burn (operating cash flow and free cash flow negative, including ~-$218M operating cash flow in 2025), keeping funding/execution risk elevated.

Income Statement

Revenue growth is strong and accelerating in the latest annual period (+15.1% vs. near-flat growth in 2024), and gross margin has improved meaningfully (about 69.6% in 2025 vs. ~55.0% in 2024), indicating better unit economics. However, profitability remains weak: the company is still generating sizable operating and net losses (net margin around -19.3% in 2025), even though losses narrowed materially from 2024’s exceptionally large loss year. Overall: improving fundamentals and margin profile, but still not yet profitable.

Balance Sheet

Balance sheet risk has improved versus 2024 as equity rebuilt substantially (about $491M in 2025 vs. ~$56M in 2024), which reduced leverage from very high levels (debt-to-equity fell from ~8.3x to ~1.7x). That said, debt remains sizeable (~$816M), return on equity is still negative given ongoing losses, and the capital structure still reflects meaningful leverage for a company not yet consistently profitable.

Cash Flow

Cash generation remains a key weakness: operating cash flow and free cash flow are both negative in each year shown, including 2025 (operating cash flow about -$218M). Free cash flow also worsened in 2025 (about -12.1% growth), signaling continued cash burn despite improving income statement trends. Overall: persistent negative cash flow increases funding/financing dependence until profitability and cash conversion improve.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.27B	693.40M	531.82M	320.67M	257.85M
Gross Profit	885.69M	381.11M	286.18M	130.19M	83.64M
EBITDA	-222.36M	-610.42M	-133.33M	-236.85M	-219.52M
Net Income	-245.03M	-705.81M	-214.12M	-289.81M	-259.19M
Balance Sheet
Total Assets	2.27B	926.12M	564.05M	631.36M	531.35M
Cash, Cash Equivalents and Short-Term Investments	755.00M	448.26M	197.57M	302.94M	277.69M
Total Debt	815.71M	468.09M	488.14M	433.03M	238.95M
Total Liabilities	1.78B	869.78M	1.95B	1.76B	1.34B
Stockholders Equity	491.33M	56.34M	-1.38B	-1.13B	-807.49M
Cash Flow
Free Cash Flow	-239.14M	-211.17M	-248.95M	-186.58M	-223.75M
Operating Cash Flow	-218.09M	-189.04M	-214.34M	-168.20M	-211.98M
Investing Cash Flow	-398.36M	-130.39M	-40.31M	-57.94M	-21.72M
Financing Cash Flow	884.12M	494.33M	117.55M	251.39M	-2.04M

Tempus AI, Inc. Class A Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 53.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEM, the sentiment is Negative. The current price of 53.05 is below the 20-day moving average (MA) of 54.52, below the 50-day MA of 60.62, and below the 200-day MA of 69.76, indicating a bearish trend. The MACD of -2.36 indicates Negative momentum. The RSI at 42.45 is Neutral, neither overbought nor oversold. The STOCH value of 27.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TEM.

Tempus AI, Inc. Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DOCS	71 Outperform	$4.82B	33.71	23.82%	―	20.21%	44.14%
GDRX	62 Neutral	$784.50M	11.69	4.54%	―	1.30%	―
OMCL	54 Neutral	$1.92B	1,014.72	0.17%	―	10.67%	―
GH	54 Neutral	$12.14B	-30.76	―	―	30.38%	24.17%
TDOC	53 Neutral	$913.39M	―	-13.93%	―	-2.37%	77.85%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
TEM	49 Neutral	$9.44B	-42.00	-89.48%	―	72.58%	76.81%

Tempus AI, Inc. Class A Corporate Events

Tempus AI Reports Strong Q4 Growth and Positive EBITDA

Tempus AI, Inc., a technology company applying artificial intelligence to precision medicine, reported robust growth for the quarter and year ended December 31, 2025, with 2025 revenue up 83.4% year over year to $1.27 billion. The business is anchored by diagnostics, including oncology and hereditary testing, and a data and applications segment that licenses insights from its expansive multimodal dataset.

For the fourth quarter of 2025, Tempus posted revenue of $367.2 million, an 83.0% increase, with diagnostics revenue more than doubling and data and applications up 25.1%, while gross profit rose 94.7% to $237.7 million. The company narrowed its losses on an adjusted basis, achieving positive fourth-quarter Adjusted EBITDA of $12.9 million and improving full-year Adjusted EBITDA to a loss of $7.4 million, supported by strong remaining contract value of over $1.1 billion and net revenue retention of 126%.

Tempus ended 2025 with $759.7 million in cash and marketable securities and issued 2026 guidance calling for approximately $1.59 billion in revenue and Adjusted EBITDA of about $65 million, signaling a path toward higher-margin growth. Operationally, it launched Paige Predict, an AI-powered digital pathology suite, reported study results showing its Immune Profile Score better predicts immunotherapy outcomes than conventional biomarkers, and expanded strategic collaborations with NYU Langone Health and Northwestern Medicine to broaden genomic testing access and develop AI-driven diagnostic tools.

The most recent analyst rating on (TEM) stock is a Buy with a $100.00 price target. To see the full list of analyst forecasts on Tempus AI, Inc. Class A stock, see the TEM Stock Forecast page.

Tempus AI Reports Strong Preliminary 2025 Revenue Growth

On January 11, 2026, Tempus AI announced select preliminary, unaudited financial results for the fourth quarter and full year ended December 31, 2025, highlighting a sharp acceleration in both its Diagnostics and Data and Applications businesses. For full year 2025, the company reported estimated revenue of about $1.27 billion, up roughly 83% year over year, including about 30% organic growth excluding its Ambry acquisition; Diagnostics revenue was approximately $955 million, up around 111% year over year on oncology testing volume growth of about 26% and hereditary testing growth of about 29%, while Data and Applications revenue reached roughly $316 million, an increase of about 31% driven by around 38% growth in data licensing. In the fourth quarter of 2025, Tempus generated an estimated $367 million in revenue, also up about 83% year over year, with Diagnostics revenue of roughly $266 million growing about 121% and Data and Applications revenue of approximately $100 million rising around 25% year over year, including an estimated 68% jump in Insights (data licensing) when adjusted for a prior-year AstraZeneca warrant impact. Management characterized 2025 as an exceptional year and said both core product lines are entering 2026 with accelerating growth and improving financial leverage, underscoring Tempus’s strengthening position in AI-driven precision medicine; the company noted these figures are preliminary and unaudited and may change when it reports full fourth-quarter and 2025 results in February 2026.

The most recent analyst rating on (TEM) stock is a Hold with a $80.00 price target. To see the full list of analyst forecasts on Tempus AI, Inc. Class A stock, see the TEM Stock Forecast page.