Tempus Ai,Inc.(US:TEM)2025-05-06 20:30Financial Data and Key Metrics Changes - Quarterly revenue increased by 75.4% year over year to $255.7 million [4] - Genomics revenue reached $193.8 million, reflecting approximately 89% year over year growth [4] - Gross profit for the quarter was $155.2 million, representing a 99.8% growth year over year [5] - Adjusted EBITDA improved to negative $16.2 million from negative $43.9 million year over year, an improvement of $27.8 million [5] - Full year 2025 revenue guidance increased to $1.25 billion, indicating about 80% year over year growth [5] Business Line Data and Key Metrics Changes - Oncology testing revenue grew by 31% year over year, with approximately 20% volume growth [4] - Hereditary testing contributed $63.5 million in revenue, with unit growth of 23% [5] - Revenue from data and services totaled $61.9 million, marking a 43% year over year growth, led by insights or data licensing business which grew by 58% [5] Market Data and Key Metrics Changes - The company reported delivering approximately 158,000 tests in the quarter, with unit growth in the 20% range [45] - The insights business and data services business grew more than 40%, with the insights business specifically growing by 58% [46] Company Strategy and Development Direction - The company announced a three-year $200 million data and modeling license agreement with AstraZeneca and Pathos to build a foundation model in oncology [6] - This agreement is expected to enhance the company's capabilities in precision medicine and data-driven diagnostics [9] - The company aims to leverage AI technology to differentiate its diagnostics offerings and improve patient outcomes [50] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand for hereditary testing and the potential for significant growth in the future [24] - The company is focused on long-term sustained growth rather than short-term fluctuations, emphasizing the importance of maintaining a steady growth trajectory [45] - Management acknowledged the challenges in the biotech funding environment but noted that relationships with large pharmaceutical companies remain strong and committed [70] Other Important Information - The company has over 4,000 connections to high-quality institutions, enhancing its data capabilities [30] - The company is actively investing in AI applications and data infrastructure to support future growth [38] Q&A Session Summary Question: Follow-up on the Pathos deal and its implications for other pharma collaborations - Management noted significant interest from other pharmaceutical companies following the Pathos deal, with ongoing discussions about potential collaborations [14][15] Question: Insights on the Hereditary business performance - Management highlighted that the hereditary business is performing better than expected, with a potential for continued high growth rates [22][25] Question: Details on the Deep Six acquisition and its capabilities - The acquisition of Deep Six is expected to enhance the company's data connectivity and analytics capabilities, allowing for richer data sets [28][30] Question: Clarification on gross margin and ASP improvements related to reimbursement - Management indicated that ASP improvements are expected as the company migrates more volume to FDA-approved versions of assays, but no reimbursement has been baked into current projections [34][35] Question: Assessment of risks in the current macro environment - Management acknowledged some impact on biotech funding but emphasized that relationships with large pharma companies remain stable and committed [68][70] Question: Update on MRD assay performance and expectations - Management reported strong demand for both tumor naive and tumor informed assays, with expectations for strong volumes once reimbursement is secured [72][74]