8-K: Tempus AI Reports Strong 2025 Preliminary Results

Tempus AI announced preliminary unaudited financial results for Q4 and full year 2025, reporting significant revenue growth and record total contract value.

Summary

• Full Year 2025 Revenue reached approximately $1.27 billion, representing about 83% growth year-over-year, including approximately 30% organic growth (excluding Ambry).
• Full Year 2025 Diagnostics revenue was approximately $955 million, an increase of about 111% year-over-year, driven by Oncology volume growth of approximately 26% and Hereditary volume growth of approximately 29%.
• Full Year 2025 Data and applications revenue was approximately $316 million, representing about 31% growth year-over-year, with Insights (Data Licensing) growing approximately 38%.
• Fourth Quarter 2025 Revenue was approximately $367 million, an increase of approximately 83% year-over-year.
• Fourth Quarter 2025 Diagnostics revenue was approximately $266 million, representing about 121% growth year-over-year, driven by Oncology volume growth of approximately 29% and Hereditary volume growth of approximately 23%.
• Fourth Quarter 2025 Data and applications revenue was approximately $100 million, representing about 25% year-over-year growth, with Insights growing approximately 68%, excluding the impact of the AstraZeneca warrant in Q4 of 2024.
• Total Contract Value (TCV) exceeded $1.1 billion as of December 31, 2025, marking a record high for the company.
• Net revenue retention for 2025 was approximately 126%, demonstrating continued expansion with existing customers.
• Tempus signed data agreements with over 70 customers during 2025, including major biopharma companies such as AstraZeneca, GlaxoSmithKline, Bristol Myers Squibb, Pfizer, Novartis, Merck, Abbvie, Daiichi Sankyo, Eli Lilly, and Boehringer Ingelheim.

Sentiment

Score: 9

Explanation: The filing reports exceptionally strong preliminary financial results, including significant revenue growth, accelerated business line performance, record total contract value, and high net revenue retention. Management expresses high confidence and excitement for future growth, positioning the company strongly for 2026. The only cautionary note is the preliminary nature of the results.

Positives

• Achieved strong overall revenue growth for full year 2025 of approximately 83% year-over-year, exceeding initial expectations.
• Diagnostics revenue growth accelerated for the third consecutive quarter, with Oncology volume growth hitting the highest unit growth rate in years (approximately 29% in Q4).
• Data and Applications business performed exceptionally well, with record revenue of approximately $100 million in Q4 and full-year growth of approximately 31%.
• Insights (data licensing) business showed robust growth of approximately 38% for the full year and approximately 68% in Q4 (excluding AstraZeneca warrant impact).
• Reported a record Total Contract Value (TCV) exceeding $1.1 billion as of December 31, 2025, indicating strong future revenue visibility.
• Demonstrated strong customer expansion with a high Net Revenue Retention of approximately 126% in 2025.
• Successfully secured data agreements with over 70 customers in 2025, including numerous large and mid-sized pharmaceutical and biotech companies.

Negatives

• The disclosed financial results are preliminary, unaudited, and inherently uncertain, subject to change as the company completes its year-end close and review procedures, with final results potentially differing materially from these estimates.

Risks

• Risks related to Tempus's financial performance.
• Challenges in attracting and retaining customers and partners.
• Difficulties in managing growth and future expenses.
• Impact of competition and new market entrants.
• Compliance with new laws, regulations, and executive actions, including evolving regulations in the artificial intelligence space.
• Ability to maintain, protect, and enhance Tempus's intellectual property.
• Ability to attract and retain qualified team members and key personnel.
• Ability to repay or refinance outstanding debt, or to access additional financing.
• Risks associated with completed and future acquisitions, divestitures, or investments.
• Potential adverse impact of climate change, natural disasters, health epidemics, macroeconomic conditions, and war or other armed conflict.
• Additional risks, uncertainties, and factors described in Tempus's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and Quarterly Report on Form 10-Q for the period ended September 30, 2025.

Future Outlook

Management expresses high confidence and excitement for 2026, anticipating continued acceleration in growth for both main businesses and delivering the financial leverage inherent in the platform. AI is expected to act as a catalyst across all products, positioning the company in an exceptionally strong position for the upcoming year.

Management Comments

• "2025 was an exceptional year for Tempus with the strength of both of our product lines exceeding our initial expectations for the year." Eric Lefkofsky, Founder and CEO.
• "Within Diagnostics, year-over-year volume growth of our genomics (oncology) offering accelerated for the third consecutive quarter hitting the highest unit growth rate we have seen in years." Eric Lefkofsky, Founder and CEO.
• "Our Data and Application business is performing even better with record revenue of ~$100 million in the fourth quarter, achieving full-year growth of ~31%, with our data licensing business growing ~38%." Eric Lefkofsky, Founder and CEO.
• "We enter 2026 in an exceptionally strong position with both of our main businesses accelerating in growth and delivering the financial leverage inherent in our platform. With AI as a catalyst across all of our products, we couldnt be more excited for 2026." Eric Lefkofsky, Founder and CEO.
• "2025 was a record year for our Data and applications business both from a revenue and TCV perspective." Jim Rogers, Chief Financial Officer.
• "Our engagement with life sciences companies has never been stronger, and our data business has never been better positioned, giving us tremendous visibility to continued growth in 2026 and beyond." Jim Rogers, Chief Financial Officer.

Industry Context

Tempus AI operates at the forefront of precision medicine, leveraging artificial intelligence to transform healthcare. The reported strong growth in both diagnostics and data/applications revenue, coupled with a record Total Contract Value and high net revenue retention, underscores the increasing demand for AI-driven solutions in drug discovery, development, and personalized patient care within the biopharma industry. The company's success in securing data agreements with over 70 customers, including major pharmaceutical companies, highlights the growing industry trend towards integrating multimodal data and AI platforms to accelerate therapeutic innovation and improve patient outcomes.

Comparison to Industry Standards

• The filing does not provide specific comparable companies or projects with detailed results for direct comparison.
• The reported ~83% year-over-year revenue growth and ~126% net revenue retention are indicative of strong performance within the high-growth AI and precision medicine sectors.
• The ability to secure data agreements with major biopharma players like AstraZeneca, GlaxoSmithKline, Bristol Myers Squibb, Pfizer, Novartis, Merck, Abbvie, Daiichi Sankyo, Eli Lilly, and Boehringer Ingelheim suggests a highly competitive and valuable offering in the market for AI-enabled healthcare data and solutions.

Stakeholder Impact

• Shareholders: Likely positive impact due to strong financial performance, significant revenue growth, record TCV, and a positive future outlook, which could lead to increased share value.
• Customers (Physicians/Patients): Continued access to advanced AI-enabled precision medicine solutions, potentially leading to more personalized patient care and optimal therapeutic outcomes.
• Customers (Biopharma): Enhanced drug discovery and development efforts through access to Tempus's unique multimodal dataset and AI platform, fostering stronger partnerships.
• Employees: Positive outlook for company growth and stability, potentially leading to increased opportunities and job security.

Next Steps

• Complete the preparation of financial statements for the fourth quarter and full year 2025.
• Report complete fourth quarter and full year 2025 financial results during an earnings call scheduled for February 2026.
• Continue to leverage AI as a catalyst across all products to drive continued growth in 2026.

Key Dates

Recommendation

The preliminary results indicate exceptional performance across both key business segments, significantly exceeding expectations. The substantial year-over-year revenue growth, accelerating diagnostics volumes, and record data and applications revenue demonstrate strong market penetration and product-market fit. The record Total Contract Value exceeding $1.1 billion and a net revenue retention rate of 126% highlight robust customer acquisition, expansion, and long-term revenue visibility. Management's highly optimistic outlook for 2026, driven by AI as a catalyst, suggests sustained momentum. While the results are preliminary, the magnitude of the reported growth and the positive commentary strongly position Tempus AI for continued success, making it a compelling investment opportunity.

Keywords

Tempus AI, TEM, Precision Medicine, AI in Healthcare, Genomics, Oncology, Diagnostics, Data Licensing, Biopharma, Total Contract Value, Revenue Growth, Financial Results, SEC Filing, 8-K