In this comprehensive guide, we’ll dive deep into Tempus AI stock (TEM) — covering everything from the company’s business model and financials to price history, predictions, and whether it’s a smart buy going forward.
Why Tempus AI Stock Matters
Tempus AI has become one of the most talked-about names in AI‑healthcare investing. It sits at the intersection of genomics, clinical data, and machine learning, offering a unique value proposition in precision medicine. For investors who believe AI will revolutionize healthcare — and for those who think big data can truly transform diagnostics — Tempus AI stock (TEM) is worth understanding deeply.
In this article, we’ll explore:
- What Tempus AI does
- The current state of TEM stock
- Its financials and growth trajectory
- Risks and potential rewards
- Price forecasts for 2025 and beyond
This isn’t surface-level analysis — we’ll get into real numbers, recent earnings, and long-term outlook.
Company Overview: What Is Tempus AI?
Tempus AI, Inc. is a health‑technology company based in Chicago. It was founded in 2015 by Eric Lefkofsky after his wife’s cancer diagnosis, reflecting a deeply personal mission.
Key facts about Tempus:
- Industry: Precision medicine / AI-health technology
- Headquarters: Chicago, Illinois
- Employees: ~2,300 as of 2024
- Ticker: TEM (NASDAQ)
- IPO Date: June 14, 2024, at $37/share
Core Business Focus
Tempus is building an AI-enabled diagnostic platform, integrating genomic sequencing, clinical data, and machine learning to deliver “intelligent diagnostics.”
Its business spans:
- Genomic sequencing — cancer, hereditary testing, liquid biopsies
- Clinical decision support — AI tools embedded in care workflows
- Data licensing — Tempus sells de-identified clinical & molecular data to pharma / research
- Drug-discovery partnerships — collaborating on foundation models for oncology
Tempus AI Stock Snapshot & Today’s Price
Here’s where TEM stock stands as of the latest available data:
| Metric | Value |
|---|---|
| Ticker / Exchange | TEM / Nasdaq |
| Recent Share Price | ~$68.48 per share |
| 52‑Week Range | $31.36 – $104.32 |
| Market Cap | ~ $12.18 B |
Key take‑aways about its stock behavior:
- High volatility: The wide 52-week range reflects strong swings.
- Growth momentum: From IPO at $37 to current levels, there’s been significant investor interest.
- But not without risk: As we’ll see, costs are high, and profitability is still a future goal.
Tempus AI Stock & Financial Projections (2025–2030)
We will use realistic assumptions based on growth trends, management guidance, and industry expectations:
- Revenue growth: Starts at 1.25B in 2025, gradually slowing to 15% by 2030
- Adjusted EBITDA margin: Moves from near breakeven (0.4%) in 2025 to 25% in 2030 as operations scale
- Stock price range: Estimated using a P/S multiple starting at ~10x in 2025, gradually stabilizing to 8x by 2030
| Year | Revenue ($B) | Adjusted EBITDA ($M) | EBITDA Margin (%) | Estimated TEM Price Range ($) |
|---|---|---|---|---|
| 2025 | 1.25 | 5 | 0.4% | 60 – 85 |
| 2026 | 1.50 | 75 | 5% | 70 – 95 |
| 2027 | 1.80 | 180 | 10% | 85 – 110 |
| 2028 | 2.15 | 430 | 20% | 100 – 140 |
| 2029 | 2.50 | 625 | 25% | 115 – 160 |
| 2030 | 2.88 | 720 | 25% | 130 – 180 |
Assumptions & Key Notes:
- Revenue Growth:
- Strong early growth (25–30%) in 2025–2026 due to AI adoption, new products, and data licensing.
- Gradual slowdown to 10–15% by 2030 as market matures and competition increases.
- EBITDA Margin:
- 2025 is near breakeven as Tempus invests heavily in AI infrastructure and lab operations.
- Margins expand to 25% by 2030 due to scale efficiencies, recurring licensing revenues, and AI products adoption.
- Stock Price Estimation:
- P/S multiple starts at ~10x for high-growth early stage (reflecting investor enthusiasm).
- Multiple gradually stabilizes to 8x by 2030 as company matures and profitability becomes more predictable.
- Catalysts for Upside:
- Successful adoption of AI diagnostic tools in hospitals.
- Expansion of data licensing agreements with pharma.
- Regulatory approvals and payer reimbursements for new AI-driven tests.
- Downside Risks:
- Execution delays, increased competition, or regulatory hurdles could slow growth.
- Cash burn remains a concern until EBITDA and free cash flow stabilize.
Visualizing Growth
Revenue vs Adjusted EBITDA (2025–2030)
| Year | Revenue ($B) | Adjusted EBITDA ($M) |
|---|---|---|
| 2025 | 1.25 | 5 |
| 2026 | 1.50 | 75 |
| 2027 | 1.80 | 180 |
| 2028 | 2.15 | 430 |
| 2029 | 2.50 | 625 |
| 2030 | 2.88 | 720 |
- Revenue: steady growth, reflecting adoption of Tempus AI’s platform and services
- EBITDA: rapid improvement as AI tools, recurring data licensing, and operational scale kick in
Business Model & Revenue Streams
To understand how Tempus makes money, we need to break down its revenue sources and how they’re scaling.
Revenue Streams
Tempus divides its business into several core segments:
- Genomics Testing
- Next-generation sequencing (NGS) for cancer (oncology)
- Hereditary/genetic testing
- Liquid biopsy (monitoring minimal residual disease)
- Data & Services / Licensing
- De-identified clinical, molecular, and imaging data licensed to pharma and research institutions
- Analytical tools and cloud compute for life sciences
- AI‑Enabled Products
- Tempus One: AI clinical assistant integrated into EHRs
- Tempus Next: Clinical decision support for oncology therapy decisions
- xM Liquid Biopsy: Monitor cancer therapy response
- Partnerships & Drug Discovery
- Collaborations with pharmaceutical companies to build foundation models in oncology
- Licensing fees and model development fees from these partnerships
This multi-pronged approach helps diversify Tempus’s risk and revenue potential.
Financial Performance & Key Metrics
Let’s dive into the financials — revenue growth, losses, margins, and what management expects going forward.
Q1 2025 Performance
- Revenue: $255.7 million → +75.4% YoY
- Gross Profit: $155.2 million; substantial gross margin improvement in genomics and data services
- Guidance: 2025 revenue expected at $1.25 B, with adjusted EBITDA positive ~$5 million
Q2 2025 Performance
- Revenue surged 89.6% YoY to $314.6 million
- Genomics revenue grew 115.3% YoY
- Data & services revenue climbed 35.7% YoY, with “Insights” (data licensing) up 40.7%
- Cash & securities at quarter-end: $293 million
- Replaced more expensive debt via $750 million convertible notes, improving capital flexibility
2024 Performance (Preliminary)
- Full-year revenue (2024): ~$693 million, ~30% YoY growth
- Genomics revenue growth ~30% in Q4
- Data & Services growth ~45% in Q4
- Adjusted EBITDA showed improvement vs prior year
Market Opportunity & Growth Drivers
Why could Tempus AI’s business scale massively — and why might investors be excited?
Size of the Opportunity
- Genomics / Precision Medicine: Market for genomic diagnostics is growing rapidly.
- AI in Healthcare: Providers increasingly adopt AI for diagnostics and decision support.
- Data Licensing: Pharmaceutical companies and researchers demand real-world clinical + molecular + imaging data to train AI models and improve drug development.
Strategic Advantages
- Proprietary Dataset: Tempus has a massive dataset of clinical + genomic + imaging data.
- Integrated Platform: Full diagnostic-to-data workflow.
- Pharma Partnerships: Deals provide recurring revenues and growth opportunities.
- Regulatory Progress: Achieved some payer and FDA milestones.
- Geographic Expansion: Ventures in Japan and potential international markets.
Competitors & Industry Position
Major Competitors / Peers:
- Illumina – Genomics giant, more lab-focused, not AI-first
- Guardant Health – Liquid biopsy leader
- NeoGenomics / Foundation Medicine – Oncology diagnostics competition
- Emerging AI-health players – AI-powered clinical data platforms
Tempus Differentiators:
- AI-first platform
- Multi-revenue model
- Massive data footprint
- Integration with clinical workflows
Tempus AI Stock Analysis: Strengths & Risks
Strengths
- High-growth revenue
- Proprietary data → strong AI moat
- Strategic partnerships with pharma
- Regulatory traction and payer relationships
- Diversified revenue streams
- Capital flexibility for growth
Risks
- Unprofitable at the net level
- Cash burn and high operational costs
- Regulatory and compliance risks
- Competitive pressure from legacy and emerging players
- Market sentiment and valuation swings
Tempus AI Stock Forecast & Price Predictions
Short-Term Outlook (Next 12 Months)
- Catalysts: Revenue ramp, product launches, regulatory milestones, licensing deals
- Risks: Cash burn, margin pressure, slower adoption
Medium-Term Outlook (2025)
- Revenue guidance: $1.25B
- Adjusted EBITDA expected positive (~$5M)
- Clinical adoption of AI tools increases recurring revenues
2025 Price Scenarios:
| Scenario | Description | Possible TEM Price Range |
|---|---|---|
| Bull | Strong execution and growth | $80–120 |
| Base | Meets guidance, stable growth | $60–85 |
| Bear | Execution or regulatory issues | $40–60 |
Long-Term Outlook (2030)
- AI healthcare adoption grows
- Data license business scales
- Profitability becomes sustainable
- Potential valuation aligns with high-growth biotech / AI-health peers
Valuation Analysis
Current Valuation
- Market Cap: ~$12.18B
- Revenue (TTM): ~$1.11B
- Net Income (TTM): –$203.88M
Price-to-Sales (P/S) Ratio: ~11x
Valuation Risks:
- Requires strong execution to justify high multiples
- Profitability must improve to stabilize valuation
Tempus AI IPO
- Date: June 14, 2024
- IPO Price: $37 per share
- Shares Offered: 11.1 million Class A shares
- Capital Raised: $410.7 million before underwriting discounts
- Purpose: Scale lab operations, fund AI development, expand platform business
Recent News That Matters
- SoftBank Joint Venture in Japan for personalized medicine
- Acquisition of Ambry Genetics expands hereditary testing
- Acquisition of Deep 6 AI enhances clinical trial matching
- Launch of Olivia AI health app for patients
- Strong Q2 2025 financials with revenue growth and improved margins
Should You Buy Tempus AI Stock?
Who Might Buy
- Growth investors believing in AI + precision medicine
- Long-term investors comfortable with volatility
- Funds seeking AI-health exposure
Who Should Be Cautious
- Short-term traders
- Value investors
- Risk-averse investors
- Those concerned with regulation and compliance
Risk-Reward Analysis
- Upside: Strong execution, recurring revenue, data licensing growth
- Downside: Cash burn, regulatory hurdles, competition
Key Risks & Challenges
- Cash Burn / Profitability
- Regulatory Risk
- Data Privacy & Compliance
- Competitive Pressure
- Market Sentiment / Valuation Risk
- Execution Risk
Tempus AI’s Role in the Future of AI-Driven Healthcare
- Potential central data hub for AI healthcare models
- Democratization of diagnostics via AI clinical tools
- Acceleration of drug discovery through partnerships
- Empowering patients with AI-driven insights
Frequently Asked Questions (FAQ)
Ticker symbol: TEM
Profitability: Not yet; adjusted EBITDA expected positive in 2025
Revenue Drivers: Genomics testing, AI diagnostic tools, data licensing
Long-term Potential: Significant if AI adoption and data monetization scale
Top Risks: Cash burn, regulatory issues, competition, data privacy
Final Thoughts
Tempus AI (TEM) is at the forefront of AI-powered precision medicine. Its unique data advantage, multi-revenue model, and strategic partnerships make it compelling for long-term investors. However, execution risk, cash burn, and regulatory hurdles remain significant.
For investors willing to ride volatility and bet on AI healthcare growth, TEM stock could be a cornerstone investment. For risk-averse investors, monitoring its cash flow and regulatory progress before committing is prudent.
