Key Takeaways
- Q1 revenue reached $348.1M, climbing 36.1% year-over-year and surpassing the $345.4M consensus estimate
- Adjusted EPS loss of $0.13 came in better than the anticipated $0.20 loss, though GAAP loss expanded to $0.70 per share
- 2026 full-year revenue forecast increased to $1.59–$1.60B, but the midpoint barely exceeded Street expectations
- Shares of TEM declined 7.2% during after-hours trading following a regular session close at $54.07
- Wall Street maintains a “Moderate Buy” rating with a mean price target of $71.36
Tempus AI (TEM) delivered first-quarter results that exceeded both revenue and adjusted earnings forecasts, yet shares tumbled 7.2% in extended trading Tuesday as the company’s annual outlook failed to energize investors.
The precision medicine firm posted quarterly revenue of $348.1 million for the period ending March 31, marking a 36.1% increase from the prior year and topping analyst projections of $345.4 million. TEM shares finished regular trading at $54.07 before sliding in after-hours activity.
On an adjusted basis, the company recorded a loss of $0.13 per share, outperforming the Wall Street consensus of a $0.20 loss. However, the GAAP net loss per share expanded to $0.70—falling short of analyst forecasts.
The company’s net loss for the quarter expanded to $125.9 million, compared to $68.0 million during the same quarter last year. Contributing factors included $56.3 million in stock-based compensation expenses and $32.3 million in unrealized losses tied to marketable securities holdings.
The Diagnostics division generated $261.1 million in revenue, representing a 34.7% year-over-year increase. Oncology test volumes expanded by 28%, while minimal residual disease (MRD) testing exploded approximately 500% compared to last year, reaching roughly 6,500 tests.
Data and Applications revenue jumped 40.5% to $87.0 million. The Insights component within this segment grew by 44.1%. The quarter also marked the third consecutive period where bookings exceeded the $100 million threshold.
Gross profit surged 43.1% year-over-year to $222.0 million. Adjusted EBITDA loss narrowed to $2.8 million from a $16.2 million loss in the comparable quarter of 2025.
Full-Year Outlook Falls Short
Tempus lifted its 2026 full-year revenue projection to a range of $1.59–$1.60 billion, implying approximately 25% annual growth. The midpoint of $1.595 billion aligned almost exactly with Wall Street’s consensus estimate of $1.592 billion—offering limited upside to excite the market.
Management maintained its adjusted EBITDA guidance at approximately $65 million for the fiscal year. Company executives emphasized during the earnings call that no additional capital raises are anticipated and that free cash flow generation should strengthen beginning in the second quarter.
Certain areas showed signs of deceleration. Hereditary testing volumes moderated during the quarter, though leadership expects growth to reaccelerate to the mid-teens range during the latter half of the year. Reimbursement dynamics continue to influence the pace of MRD adoption.
Wall Street Ratings and Insider Transactions
Insider selling activity has been notable. Over the past 90 days, company insiders divested 563,471 shares valued at approximately $29.8 million. Chief Accounting Officer Ryan Bartolucci and Executive Vice President Andrew Polovin were among executives who reduced holdings in February.
Analyst opinions remain divided. Needham maintains a Buy rating with a $75 price target. Morgan Stanley reduced its target from $85 to $70 while preserving an Overweight stance. Guggenheim lowered its objective from $95 to $60 but retained its Buy recommendation. Jefferies initiated coverage with an Underperform rating and $35 target.
The overall Street consensus stands at “Moderate Buy” with an average price objective of $71.36, suggesting substantial upside from current trading levels.
Institutional ownership has increased in recent quarters. Invesco expanded its position by more than 2,900%, while Royal Bank of Canada boosted its stake by 201%.
Shares have traded within a 52-week range of $41.73 to $104.32, with the 200-day moving average currently positioned at $62.91.
