Tempus AI, Inc. (TEM)

Price$64.46Cached quoteAs of 2026-09-04 16:23 UTC

AI: Overvalued

Price checkThe shares look expensive because today’s valuation assumes years of strong growth and margin gains.

The observed price values Tempus at roughly $12.4 billion. Management guides to $1.595–$1.605 billion of 2026 revenue and about $65 million of adjusted operating profit before interest, taxes and several excluded costs. That is roughly 7.7 times guided revenue and about 190 times that profit measure. Even assuming a strong future 20% net profit margin on $1.6 billion of sales, the current equity value would equal about 39 times hypothetical earnings. That leaves little value-investor margin for disappointment.

Big pictureRevenue is scaling quickly, but operating losses and free cash flow remain too weak for comfort.

Revenue reached $1.27 billion in 2025, up 83% from 2024, while the operating loss narrowed to $253 million from $691 million. Recent four-quarter revenue is about $1.43 billion, yet operating cash flow remained roughly negative $237 million and capital spending was about $26 million. Free cash flow, meaning cash left after running and investing in the business, was therefore around negative $263 million. Second-quarter cash burn improved sharply, but one good quarter does not yet establish durable cash generation.

Business strengthDemand is strong and liquidity is ample, but convertible debt and stock awards reduce the cushion.

Second-quarter revenue grew 22%, oncology testing volume rose 31%, and data licensing and modeling revenue grew 36%. Tempus also signed about $200 million of new Data and Applications licenses. Current assets were about $1.29 billion against $391 million of current liabilities. However, the latest filing records $1.17 billion of convertible senior notes, while first-half stock compensation reached $107 million, about 15% of first-half revenue. The business is less tied to consumer cycles than reimbursement, testing adoption and sometimes-lumpy data contracts.

What could change the storySustained positive cash flow or a clearly accretive Personalis deal could justify more of today’s premium.

The bull case strengthens if revenue keeps growing above 20%, free cash flow turns sustainably positive and Personalis expands cancer-monitoring adoption without heavy dilution. The bear case is that investors are paying today for profits still years away while financing acquisitions with shares and convertible debt. As a rough benchmark, a $12.4 billion equity value at 20 times earnings and a strong 20% net margin requires roughly $3.1 billion of annual revenue, almost twice the 2026 guide. Progress toward that scale without major new dilution would materially improve the valuation case.

AI: News

Personalis acquisitionTempus agreed to buy Personalis, adding cancer-monitoring technology but creating financing and dilution risk.

On July 20, Tempus agreed to acquire Personalis at an enterprise value of about $1.5 billion, net of its existing stake. The deal is structured primarily around Tempus shares, although Tempus can elect cash for up to 50% of the consideration. Personalis had only $22.4 million of second-quarter revenue. Tempus shares fell nearly 9% after the announcement, according to Reuters, consistent with investor concern about the purchase price and financing structure rather than the strategic rationale alone.

Second-quarter resultsRevenue growth stayed strong and guidance rose, but the headline profit depended on investment gains.

Tempus reported second-quarter revenue of $382.5 million, up 22%, and gross profit of $246.5 million, up 26%. It posted $5.6 million of net income and $8 million of adjusted operating profit before interest, taxes and selected exclusions. However, net income included about $98.5 million of unrealized gains on marketable investments. Management raised 2026 revenue guidance to $1.595–$1.605 billion while maintaining roughly $65 million of adjusted operating profit guidance, improving expectations without yet proving durable accounting profitability.

Cancer-vaccine readoutA successful late-stage melanoma trial increased the strategic value investors assign to the Personalis deal.

On August 19, Merck and Moderna said their Phase 3 personalized melanoma therapy met its main recurrence and distant-spread endpoints. Personalis has supplied its tumor-profiling technology to the same individualized cancer-vaccine program for years. Tempus shares rose about 24% that day and roughly 40% from the prior Friday through August 21. The timing and industry coverage strongly link the rally to the trial, but that remains market interpretation; the result does not itself guarantee future Tempus or Personalis revenue.

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Revenue

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2023

2024

2025

Net income

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Free cash flow

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Total cash / debt

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Financial statements

	2025	2024	2023	2022
Revenue	$1.27B	$693.4M	$531.8M	$320.7M
Research & development	$172.9M	$149.3M	$90.3M	$83.2M
Operating expenses	$1.52B	$1.38B	$727.9M	$586.1M
Operating income	−$252.9M	−$691.1M	−$196.1M	−$265.4M
Operating margin	−19.88%	−99.67%	−36.87%	−82.78%
EBITDA	−$220.8M	−$664.7M	−$174.5M	−$248.4M
EBITDA margin	−17.36%	−95.87%	−32.82%	−77.45%
Net income	−$245.0M	−$705.8M	−$214.1M	−$289.8M
Net profit margin	−19.27%	−101.79%	−40.26%	−90.38%
Basic EPSper basic share	-$1.41	-$6.23	-$4.20	-$5.30
Diluted EPSper diluted share	-$1.41	-$6.23	-$4.20	-$5.30

Review official source filings ↗

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)452$842.31M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 25, 2026Form 4 · 10b5-1	Rogers James WilliamChief Financial Officer	SellClass A Common Stock	11.5K	$55.00	$634.1K	114.9K
Jun 25, 2026Form 4 · 10b5-1	Doudna Jennifer ADirector	SellClass A Common Stock	2.7K	$55.00	$147.0K	25.9K
Jun 1, 2026Form 4 · 10b5-1	Epstein David RDirector	SellClass A Common Stock	250	$49.40	$12.3K	31.5K
May 27, 2026Form 4 · 10b5-1	LEFKOFSKY ERIC PCEO and Chairman	SellClass A Common Stock · indirect	97.3K	$46.89	$4.56M	15.52M
May 27, 2026Form 4 · 10b5-1	LEFKOFSKY ERIC PCEO and Chairman	SellClass A Common Stock · indirect	35.7K	$46.17	$1.65M	15.62M

Review ownership filings at SEC.gov ↗

Community posts

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@tickerstat17 hours ago
Tempus plans disease-focused dataset covering 100,000 whole genomes
Tempus AI ($TEM) launched an initiative to build a research platform linking 100,000 whole-genome sequences with long-term clinical information over several years. The company intends to focus on disease populations and treatment outcomes, ...
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Tempus AI, Inc. (TEM)

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Tempus plans disease-focused dataset covering 100,000 whole genomes