Live Earnings: Will Tempus AI Surprise Wall Street Tonight?

Core Viewpoint - Tempus AI achieved positive adjusted EBITDA for the first time in Q3 at $1.5 million, with Q4 revenue reaching $367 million, an 83% year-over-year increase. Despite beating revenue consensus, shares declined 22% since January due to widening net losses [1]. Financial Performance - Q4 revenue was pre-announced at $367 million, reflecting an 83% year-over-year growth, with diagnostics revenue at $266 million, up 121% year-over-year [1]. - Data and Applications segment contributed $100 million, a 25% increase, while the Insights segment grew by 68% [1]. - Total contract value exceeded $1.1 billion, and net revenue retention was 126%, indicating strong customer base expansion [1]. Profitability and Guidance - Q3 net loss widened to $80 million from $75.8 million a year earlier, despite higher revenue [1]. - Management guided for slightly positive adjusted EBITDA for the full year, absorbing integration costs from the Paige acquisition [1]. - 2026 guidance is crucial, with expectations for the foundation model to produce its first versions in Q1 2026 and ongoing MRD reimbursement progress [1]. Market Reaction and Stock Performance - Tempus shares have underperformed, down approximately 22% since the preliminary filing, despite strong revenue growth and achieving a key profitability milestone [1]. - Analyst consensus includes 7 Buy ratings and 7 Hold ratings, with an average price target of $86.71, suggesting potential upside if execution remains strong [1].