Tempus Posts Preliminary 83% Revenue Growth for 2025, Reinforcing Hyper-Growth but Leaving Profitability Unproven

What happened

Tempus announced select preliminary unaudited full-year 2025 revenue of approximately $1.27 billion, representing 83% year-over-year growth, with diagnostics revenue surging 111% to about $955 million. This performance aligns with the DeepValue report's base case of ~30% annual revenue growth, driven by genomics scale and the integration of Ambry Genetics. However, the report cautions that the stock trades at rich multiples—~9x 2025 revenue and negative EV/EBITDA—embedding high expectations for sustained growth and margin expansion. The preliminary numbers do not disclose adjusted EBITDA progression or data services mix, leaving unanswered whether high-margin AI and data applications are scaling as needed for operating cash flow inflection. Investors should view this as a growth confirmation but not a resolution to the profitability and valuation risks highlighted in prior analyses.

Implication

The 83% revenue growth, particularly in diagnostics, suggests Tempus is executing on its genomics and hereditary testing scale, which could support the bull scenario of 40%+ annual growth. However, with the stock already pricing in hyper-growth, any future guidance miss or slowdown in test volumes below 30% could trigger sharp pullbacks, as historical volatility shows. The DeepValue report emphasizes that sustainable positive operating cash flow by 2026 remains unproven, and this preliminary announcement lacks details on data services growth or adjusted EBITDA margins. Investors should await audited full-year results and 2026 guidance to assess if operating leverage is materializing and if high-margin data deals are scaling. In the near term, this news may provide short-term momentum, but the prudent approach is to monitor for clearer profitability signals or a pullback toward the $55 attractive entry level.

Thesis delta

The preliminary results reinforce Tempus's ability to deliver hyper-growth, aligning with the bull scenario driver of rapid genomics uptake. However, the core thesis of waiting for sustainable cash flow inflection and data monetization scaling remains unchanged, as the announcement offers no evidence on adjusted EBITDA progression or data services mix improvement. No material shift in the investment call is warranted at this stage; the 'WAIT' rating and asymmetric risk profile persist.