Company Overview
Imagine a Future Where Every Medical Test is Intelligent.
In 2015, when Eric Lefkofsky's wife was diagnosed with breast cancer, he noticed something striking. While doctors had access to advanced medical tests, they lacked the technology to learn from millions of similar cases. This observation led to the founding of Tempus, a company with a bold mission: to make every medical test "intelligent" by connecting it to the world's largest database of patient outcomes.
Understanding Tempus's Revolution in Healthcare
Think of traditional medical tests like taking a snapshot - they show what's happening in your body at a specific moment. Tempus is transforming these tests into something more like conversing with millions of doctors who have treated similar cases. When a doctor orders a Tempus test, they get results and insights from millions of similar patients' experiences.
The Three Pillars of Tempus's Approach:
Smart Testing (Genomics)
Tempus has developed advanced tests that can read the genetic code of cancer cells and other diseases. But unlike traditional genetic tests, Tempus's tests are connected to their massive database, helping doctors understand not just what's wrong, but what treatments have worked best for similar patients. They're now the largest cancer testing company in America, working with over 50% of all oncologists in the country.Data Collection and Analysis
Every time a doctor uses a Tempus test, the anonymous results join their database of over 8.5 million patient records. This creates a powerful learning system - each new test makes future tests smarter. They've built what they call a "medical brain" containing over 200 petabytes of healthcare data (that's equivalent to about 4 million years of HD video).Artificial Intelligence Applications
Tempus uses artificial intelligence to analyze this massive database and help doctors make better decisions. For example, their system can automatically alert doctors if a patient might benefit from a specific treatment or clinical trial that they haven't considered. It's like having an incredibly knowledgeable assistant who has studied millions of similar cases.
Real-World Impact
The results are impressive: 96% of patients using Tempus tests can be matched to specific treatments or clinical trials, significantly higher than traditional testing methods. They work with over 2,400 hospitals and have partnerships with 19 of the 20 largest pharmaceutical companies, helping develop better treatments faster.
Looking to the Future
While Tempus started in cancer care, it's expanding into other areas like heart disease, mental health, and rare diseases. Its vision is to create a world where every medical test is connected to its vast database, helping doctors make better decisions based on the experiences of millions of similar patients.
The company represents a new kind of healthcare technology - one that combines advanced testing, massive data collection, and artificial intelligence to make precision medicine a reality for everyone. It's not just about having better tests; it's about making those tests smarter with each patient they help.
This approach has attracted significant attention from both the medical community and investors, with the company now valued at billions of dollars. But perhaps more importantly, it's helping doctors make better decisions and potentially saving lives by ensuring each patient benefits from the collective experience of millions of similar cases.
"I've spent the last 7 years building Tempus with the singular objective of bringing the power and promise of artificial intelligence to diagnostics, and thus to healthcare, to help fight diseases like cancer.”
Eric Lefkofsky (Founder & CEO)
Business Segments and Revenue Breakdown 📊
Tempus AI’s business model revolves around selling diagnostic tests to hospitals and oncologists. By sequencing tumors and analyzing genetic data, the company provides insights that can guide treatment decisions. However, the company’s long-term profitability depends on its ability to monetize its data and scale its operations.
One of the key challenges Tempus AI faces is the limited availability of targeted therapies. While the company’s genetic testing can identify specific mutations, the number of therapies available to treat those mutations is still limited. This raises questions about the immediate utility of some of Tempus AI’s tests and whether hospitals and oncologists will continue to pay for them at scale.
Additionally, Tempus AI is not yet profitable. The company reported $166 million in revenue in its first earnings report, but it is still operating at a loss. Analysts predict that profitability may come by 2025, but the company’s high valuation—currently trading at a price-to-earnings ratio (P/E) in the 50s.
Tempus AI’s success is largely driven by its extensive data collection and adoption by healthcare providers. The company has amassed 250 million gigabytes of proprietary data, which grows by an additional 20 million gigabytes per month. This data includes genetic information, clinical records, and other patient-related data, making it one of the largest repositories of cancer-related data in the world.
The company’s adoption rates are also impressive:
10,000 oncologists in the U.S. regularly order Tempus AI’s tests, representing a significant portion of the 14,000 oncologists nationwide.
2,400 hospitals in the U.S. are partnered with Tempus AI, giving the company over 50% penetration in the hospital market.
This extensive network of data and partnerships positions Tempus AI as a key player in the healthcare industry, particularly in the growing field of precision medicine.
Tempus operates at the convergence of healthcare and technology, offering a range of AI-enabled diagnostic solutions. The company’s platform integrates genomic, clinical, and molecular data to provide actionable insights for physicians and researchers. Tempus has three primary product lines:
Genomics
Tempus provides next-generation sequencing and molecular testing services, primarily in oncology.The company’s genomic tests, such as Tempus xT, xR, and xF, analyze DNA, RNA, and other biomarkers to provide insights into cancer and other diseases. These tests are enhanced by AI, enabling features like personalized treatment recommendations, clinical trial matching, and algorithmic insights to refine therapy selection. For example, Tempus’ xT test, which received FDA approval in 2023, analyzes 648 genes in solid tumors with exceptional sensitivity, while the xM test focuses on detecting minimal residual disease (MRD) in early-stage cancers.
With over 1.1 million samples sequenced and a growing portfolio of algorithmic tests, Tempus is not only improving treatment selection but also expanding into broader markets like cardiology, radiology, and neuropsychology. This integration of AI and genomics allows Tempus to continuously refine its tests, making them smarter and more effective over time.
The company’s high-throughput diagnostic laboratories in Chicago, Atlanta, and Raleigh process a growing number of tests, with oncology NGS tests increasing from 40,000 in 2019 to 218,000 in 2023. Tempus is also expanding its testing capabilities into other disease areas, including cardiology, neurology, and radiology.
Data
Tempus’ Data division is built on one of the largest multimodal healthcare databases in the world, containing over 200 petabytes of de-identified clinical, molecular, and imaging data. This data is collected in real-time from over 2,500 institutions and includes more than 8.5 million clinical records and 1.2 million imaging records. Pharmaceutical and biotechnology companies license this data to accelerate drug discovery and clinical trial design. Tempus’ AI-powered tools, such as COHORTS and LENS, allow researchers to analyze this vast dataset to uncover insights, predict therapy responses, and refine clinical trial strategies. The company has partnered with 19 of the top 20 pharmaceutical companies, securing over $900 million in committed contracts. By transforming raw data into actionable insights, Tempus is not only advancing precision medicine but also enabling faster, more efficient drug development. This data-driven approach ensures that Tempus remains a critical partner for both healthcare providers and the life sciences industry.AI-Enabled Algorithms (ALOS)
Tempus’ Applications division leverages its AI platform to create tools that improve clinical decision-making and connect patients to the right therapies or clinical trials. These applications span oncology, cardiology, radiology, and pathology, using AI to analyze multimodal data and provide actionable insights.For instance, the "NEXT" algorithm identifies care gaps in real-time, ensuring patients receive optimal therapies, while "LINK" matches patients to clinical trials with unprecedented speed and accuracy. In radiology, Tempus’ AI models analyze imaging data to flag potential cancerous lesions, while in pathology, algorithms predict biomarker status and identify risks.
The company’s TIME network, which connects over 90 health systems and 250 clinical trials, accelerates trial enrollment, reducing activation times from months to just days. By embedding AI into every aspect of its platform, Tempus is not only improving patient outcomes but also streamlining the healthcare system, making precision medicine more accessible and effective.
“Tempus has developed a distinct set of solutions that has real potential to revolutionize cancer care. I look forward to working with the leadership team in developing those offerings to provide even more value to the company, its partners, and ultimately patients.”
David R. Epstein (Seagen CEO)
Core Strengths 🏆
1. Advanced AI-Enabled Diagnostic Platform 🧬🤖
Tempus AI is revolutionizing healthcare by integrating artificial intelligence into diagnostics, creating a cutting-edge platform that combines data and diagnostics to deliver precision medicine at scale. Key highlights include:
Proprietary Data Assets: Over 200 petabytes of multimodal healthcare data, including 8.5 million clinical records, 1.2 million imaging records, and 1.1 million sequenced samples.
AI-Driven Insights: Tools like Tempus NOW, COHORTS, and LINK leverage AI to match patients to therapies, clinical trials, and care pathways in near real-time.
Generative AI Applications: Tempus analyzes vast datasets using large language models (LLMs), enabling personalized treatment recommendations and accelerating drug discovery.
2. Integrated Product Lines with Network Effects 🔗📈
Tempus operates three synergistic product lines—Genomics, Data & Services, and Applications—that reinforce one another through network effects:
Genomics: AI-enabled diagnostic tests, including NGS (Next-Generation Sequencing), assays like Tempus xT (solid tumor DNA), xR (RNA), and xF (liquid biopsy).
Data & Services: Licensing de-identified multimodal data to pharmaceutical and biotech companies, with over $900M in remaining contract value as of Q3 2024.
Applications: AI-powered tools for clinical decision support, such as NEXT (care gap algorithms) and TIME (clinical trial matching).
3. Strategic Partnerships 🤝🌍
Tempus has established itself as a trusted partner to leading healthcare institutions and life sciences companies:
50% of U.S. oncologists and 65% of academic medical centers are connected to Tempus.
Collaborations with 19 of the top 20 pharmaceutical companies and over 200 biotech firms.
Partnerships with organizations like AstraZeneca and GSK for multi-year data licensing agreements.
4. Financial Growth and Operational Scale 💰📊
Tempus has demonstrated strong revenue growth and operational scale:
Q3 2024 Revenue: $180.9M, a 33% YoY increase, driven by 64.4% growth in Data & Services revenue.
Genomics Business: Delivered over 218,700 oncology NGS tests in 2023, with average revenue per test increasing to $1,533.
Path to Profitability: The acquisition of Ambry Genetics is expected to accelerate Tempus’ growth and profitability, with the combined business projected to achieve positive adjusted EBITDA in 2025.
5. Expanding into New Disease Areas 🩺🧠
While Tempus started in oncology, its platform is disease-agnostic. It has expanded into neuropsychology, cardiology, and radiology, and it plans to enter additional categories like rare diseases and reproductive health.
Risks & Weaknesses ⚠️
1. Pre-Profitability Status 📉
Tempus remains in a pre-profitability phase, with significant operating losses.
2. Technical and Operational Challenges 🛠️
Scaling Tempus’ AI-enabled diagnostics and data platform presents several challenges:
Complex Data Integration: Ingesting and harmonizing multimodal data from over 2,500 institutions requires significant technical expertise.
Unproven Mass Adoption: While Tempus has achieved strong penetration in oncology, adoption in other disease areas is still in its early stages.
3. Competitive Landscape 🏁
Tempus operates in a highly competitive and rapidly evolving market:
Established Competitors: Competes with companies like Foundation Medicine and Guardant Health in genomics and other AI-driven healthcare platforms.
Alternative Technologies: Emerging diagnostic and data solutions could challenge Tempus’ market position.
4. Financial Vulnerabilities 💸
Tempus faces financial risks associated with its growth strategy:
Accumulated Deficit: $(2.86B) as of 2023, reflecting years of investment in R&D and platform development.
Dilution Risks: Future funding needs could dilute existing shareholders.
Reliance on External Funding: Tempus’ ability to sustain operations depends on continued access to capital markets.
5. Regulatory and Ethical Risks ⚖️
As a healthcare company, Tempus must navigate complex regulatory and ethical challenges:
Data Privacy: Ensuring compliance with HIPAA and other data protection laws is critical given the scale of its de-identified data business.
AI Bias: Addressing potential biases in AI models is essential to maintain trust and efficacy.
Management Team 👔
Eric Lefkofsky, Founder & CEO
Eric Lefkofsky is the founder and CEO at Tempus, a leader in artificial intelligence and precision medicine. He is the co-founder and General Partner of Lightbank, a private venture capital firm specializing in investments in technology companies. He is also the co-founder of Pathos AI, a clinical-stage biotechnology company focused on re-engineering drug development; Groupon (NASDAQ: GRPN), a global e-commerce marketplace; Mediaocean, a leading provider of integrated media procurement technology; Echo Global Logistics (NASDAQ: ECHO), a technology-enabled transportation and logistics outsourcing firm; and InnerWorkings (NASDAQ: INWK), a global provider of managed print and promotional solutions.
He co-chairs the Lefkofsky Family Foundation with his wife Liz to advance high-impact initiatives that enhance lives in the communities served. Lefkofsky also serves on The Art Institute of Chicago and Northwestern Medicine boards. He holds a bachelor’s degree from the University of Michigan and a J.D. from the University of Michigan Law School.
Christina Antoniou, Head of Corporate Development
Christina Antoniou serves as Senior Vice President and head of Corporate Development at Tempus, responsible for the company’s mergers, acquisitions, partnerships, and strategic investing efforts. Christina has extensive experience executing strategic and financial transactions in the healthcare industry. Before joining Tempus, Christina spent four years at Medidata Solutions, a Dassault Systèmes company. There, she held multiple roles, including Vice President, Head of Integration, and Senior Director, Corporate Development. At Medidata, Christina completed several strategic acquisitions and early-stage investments. Later she represented Medidata in its sales process, culminating in the sale of Medidata to Dassault Systèmes for $5.8 billion. After the acquisition, Christina led Medidata’s integration with Dassault Systèmes. Earlier in her career, Christina held roles in investment banking and venture capital. Christina received an MBA from the Wharton School and holds a BA from Smith College.
Ezra Cohen, MD, Chief Medical Officer of Oncology
Dr. Cohen is a leading medical oncologist and cancer researcher who brings a unique combination of extensive clinical and research experience to Tempus’ leadership team. He was most recently the Chief of the Division of Hematology-Oncology as well as the Associate Director of Clinical Science at UC San Diego (UCSD) Moores Cancer Center. Dr. Cohen also led the Precision Immunotherapy Clinic and co-directed the San Diego Center for Precision Immunotherapy at UCSD. Before UCSD, Dr. Cohen spent 15 years at the University of Chicago, where he was the co-director of the Head and Neck Cancer Program as well as Hematology/Oncology Fellowship Program Director.
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Financial Performance 📈
Tempus AI demonstrates strong revenue growth and improving operational efficiency, with significant year-over-year expansion in its core businesses.
Key Financial Metrics (FY 2024)
Revenue: ~$693M (30% YoY growth)
Q4 Revenue: ~$200M (35% YoY growth)
Genomics Revenue Growth: ~30% in Q4
Data & Services Revenue Growth: ~45% in Q4
Business Segment Performance:
Core businesses showing strong momentum
Some softness reported in CRO revenues
Achieved ~99% of 2024 revenue guidance
Met ~100% of adjusted EBITDA guidance
Capital Position
Continued sequential improvement in adjusted EBITDA
Pending Ambry acquisition (closing update available)
Strong performance in core genomics and data services
Financial Outlook
The preliminary results announcement does not provide full, detailed guidance for 2025. Complete financial results will be reported in the upcoming first earnings call of 2025.
Key Business Highlights:
Maintains position as leading AI-driven precision medicine company
Operates one of the world's largest multimodal healthcare data libraries
Focus on AI-enabled precision medicine solutions
Continued expansion in the healthcare technology sector
⚡ AI-optimized, human-verified: Our expert team carefully selected Premium market intelligence from Finchat's data. Explore now →
Top Insiders:
Eric P. Lefkofsky (CEO): 24.73% ownership, $1.4B market value
Kimberly Keywell (Business Partner): 9.27% ownership, $501.06M market value
Ryan Fukushima (Director): 0.64% ownership, $34.59M market value
Top Institutional Owners:
BK TL21 LLC: 9.66% ownership, $521.91M market value
Baillie Gifford & Co: 8.73% ownership, $471.63M market value
Gray Media, Llc.: 6.07% ownership, $327.77M market value
Future Outlook Projected by the Company:
$531 million in 2023
$693 million in 2024
$963 million in 2025
$1.17 billion in 2026
We have been conducting thorough research on Tempus AI since late December 2024, with plans to release our detailed analysis to our premium subscribers. However, recent developments have altered our publication strategy.
The significant media attention surrounding Representative Nancy Pelosi's $100,000 investment in TEM has led to an unexpected surge in the stock price, with shares climbing approximately 40% in a single trading session. Given these circumstances, we believe it's in the best interest of our community to share our analysis as a free, informative piece rather than a premium stock recommendation.
Our valuation models indicated that a 25-35$ per share entry point would have been attractive to achieve our target risk-reward ratio. We will continue monitoring TEM and may revisit it as an investment opportunity should the stock price return to more favorable levels.
10 Reasons to Consider Tempus AI (TEM) 🧬🤖
🔬 Revolutionary Platform
Leading AI-enabled diagnostic platform integrating data and diagnostics
200+ petabytes of connected clinical and molecular data
Proprietary software and data pipelines for real-time healthcare data
2. 🏥 Market Penetration
Connected to >65% of Academic Medical Centers
50% of US oncologists connected
Relationships with 2,400+ hospitals
10,000+ oncologists regularly order tests
3.💰 Strong Revenue Growth
~$693M revenue in 2024 (30% YoY growth)
Q4 2024 revenue ~$200M (35% YoY growth)
Genomics revenue growing ~30%
Data/services revenue growing ~45%
4.🤝 Strategic Partnerships
Working with 19 of the 20 largest pharmaceutical companies
$900M+ in remaining contract value
Major collaborations with AstraZeneca and GlaxoSmithKline
Acquisition of Ambry Genetics
5. 🏭 Operational Scale
Three high-throughput automated diagnostic laboratories
Locations in Chicago, Atlanta, and Raleigh
Processing hundreds of thousands of tests annually
Expanding test menu across multiple disease areas
6.🧪 Product Innovation
Comprehensive test portfolio (xT, xR, xF, xG, nP)
AI-enabled diagnostic capabilities
Voice/text assistant (Tempus ONE)
Expanding into new disease areas
7.📊 Data Monetization
Multiple revenue streams from a single diagnostic test
Data licensing to pharmaceutical companies
Clinical trial matching services
Algorithmic diagnostic products
8.👥 Leadership & Expertise
Founded by Eric Lefkofsky
2,000+ employees
One-third technical staff
Hundreds of engineers, PhDs, and MDs
9.🔬 Scientific Validation
500+ publications
150+ peer-reviewed articles
380+ poster presentations
35+ oral presentations at scientific meetings
10.🌱 Growth Strategy
Expanding beyond oncology into neuropsychology, radiology, cardiology
Ambry acquisition accelerates growth
Path to profitability in 2025
Combined revenue expected to reach ~$1B in 2024
Disclaimer: This analysis is for informational purposes only and should not be considered as financial advice. Always conduct your research and consult with a licensed financial advisor before making investment decisions.