Tempus Reports Second Quarter 2024 Results

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Insights

Tempus AI's Q2 2024 results show strong growth, with revenue up 25% YoY to $166.0 million. The data licensing revenue growth of 40% YoY is particularly impressive, indicating increasing demand for Tempus' AI-driven insights. However, the net loss of $552.2 million is concerning, although largely attributed to IPO-related expenses.

The company's expansion into the MRD market and FDA clearance for their ECG-AF device demonstrate promising product diversification. The SoftBank joint venture for Japanese market entry could be a significant growth driver. With projected 2024 revenue of $700 million (32% YoY growth) and improving Adjusted EBITDA, Tempus shows potential but needs to focus on profitability.

Tempus' expansion into the minimal residual disease (MRD) market with both tumor-naïve and tumor-informed assays is a strategic move in precision oncology. MRD testing is important for monitoring treatment efficacy and early detection of cancer recurrence, potentially improving patient outcomes. The FDA clearance for the ECG-AF device showcases Tempus' ability to leverage AI in diverse medical applications beyond oncology.

The ADLT status for xT CDx assay from CMS is significant, as it may lead to improved reimbursement and wider adoption. These developments, coupled with the 40% growth in data licensing revenue, indicate that Tempus is successfully monetizing its AI-driven insights, potentially accelerating precision medicine adoption across healthcare.

08/06/2024 - 04:01 PM

CHICAGO--(BUSINESS WIRE)-- Tempus AI, Inc. (NASDAQ: TEM), a technology company leading the adoption of AI to advance precision medicine and patient care, today reported financial results for the quarter that ended June 30, 2024, and provided recent business highlights.

Revenue increased 25% year-over-year to $166.0 million in the second quarter of 2024
Data licensing revenue growth accelerated to 40% year-over-year
Expanded into the minimal residual disease (MRD) market with the launch of both tumor-naïve and tumor-informed assays
Established a joint venture with Softbank to enter the Japanese market
Raised $410.7 million of gross proceeds in initial public offering
Net Loss of ($552.2 million), largely driven by $493.1 million of stock compensation expense and related employer payroll taxes tied to initial public offering
Adjusted EBITDA improved $12.7 million quarter-over-quarter to ($31.2 million)
Expect full year 2024 revenue of ~$700 million, which represents ~32% annual growth
For additional information on the quarter, including a letter from our CEO, please visit our investor relations site

“We continue to make great progress in deploying technology within healthcare as providers and life science companies are increasingly seeking AI solutions,” said Eric Lefkofsky, Founder and CEO of Tempus. “Given our expansive multimodal dataset, and our broad reach across thousands of connected healthcare providers, we are uniquely positioned to advance AI in diagnostics and accelerate the pace of algorithmic insights.”

Second Quarter 2024 Financial Results

	Three Months Ended June 30,
	2024		2023			Change
	(in thousands, except percentages)
GAAP Results
Revenue	$	165,969	$	132,417			25.3%
Genomics gross margin		39.2%		48.9%			NM₍₁₎
Data and services gross margin		58.7%		65.9%			NM₍₁₎
Operating expenses	$	609,005	$	116,787		NM₍₁₎
Net loss	$	(552,212)	$	(55,832	)	NM₍₁₎

Non-GAAP Results
Non-GAAP Genomics gross margin		49.4%		48.9%			50 bps
Non-GAAP Data and services gross margin		72.4%		65.9%			650 bps
Non-GAAP Operating Expenses	$	134,742	$	116,787			15.4%
Adjusted EBITDA	$	(31,186)	$	(36,967)			15.6%

_______________

(1) Not meaningful due to the impact of including stock compensation expense and related employer payroll taxes

Genomics revenue of $112.3 million in the second quarter of 2024, an increase of $20.4 million or 22.2% over the second quarter of 2023.
Data and services revenue of $53.6 million in the second quarter of 2024, an increase of $13.2 million or 32.5% over the second quarter of 2023, including 40% growth in our Insights (data licensing) business.
Non-GAAP Genomics gross margin was 49.4% in the second quarter of 2024, compared to 48.9% in the second quarter of 2023.
Non-GAAP Data and services gross margin was 72.4% in the second quarter of 2024, compared to 65.9% in the second quarter of 2023.
Net Loss of ($552.2 million), largely driven by $493.1 million of stock compensation and related employer payroll taxes tied to initial public offering.
Adjusted EBITDA ($31.2 million) in the second quarter of 2024, compared to ($43.9 million) in the first quarter of 2024.

Recent Operating Highlights

Announced the clinical launch of our MRD portfolio including Tempus’ xM tumor-naïve test and xM tumor-informed (NeXT Personal® Dx) test.
Received 510(k) clearance from the U.S. Food and Drug Administration (FDA) for the Tempus ECG-AF device that uses AI to help identify patients who may be at increased risk of atrial fibrillation/flutter (AF).
Completed a Joint Venture Agreement with SoftBank, titled “SB Tempus,” to bring Tempus’ AI-enabled precision medicine solutions to Japan.
Received Advanced Diagnostic Laboratory Test (ADLT) status from the Centers for Medicare & Medicaid Services (CMS) for Tempus’ next-generation sequencing assay, xT CDx.
Sold 11,100,000 shares of Class A common stock at $37 per share in initial public offering, raising $410.7 million of gross proceeds.

Financial Outlook and Guidance

Tempus expects full year 2024 revenue of approximately $700 million, which represents approximately 32% year-over-year growth. The Company expects approximately ($105 million) in adjusted EBITDA, an improvement of approximately $50 million over 2023.

Webcast and Conference Call Information

A conference call and webcast will begin today, August 6, 2024 after market close at 4:30 p.m. Eastern Time. Interested parties may access details at:

Conference ID: 6326328
Domestic Dial-in Number: (800) 715-9871
International Dial-in Number: (646) 307-1963
Live Webcast: https://edge.media-server.com/mmc/p/75k462fh

The webcast may be accessed on the company’s investor relations website at investors.tempus.com. For those unable to listen to the live webcast, a recording will be made available on the company’s website after the event and will be accessible for one year. Visit the investor relations website to find the company’s latest deck, and commentary on the quarter by Eric Lefkofsky, Founder and CEO and Jim Rogers, CFO, which will be discussed on the conference call and webcast.

About Tempus

Tempus is a technology company advancing precision medicine through the practical application of artificial intelligence in healthcare. With one of the world’s largest libraries of multimodal data, and an operating system to make that data accessible and useful, Tempus provides AI-enabled precision medicine solutions to physicians to deliver personalized patient care and in parallel facilitates discovery, development and delivery of optimal therapeutics. The goal is for each patient to benefit from the treatment of others who came before by providing physicians with tools that learn as the company gathers more data. For more information, visit tempus.com.

Non-GAAP Financial Measures

In addition to the financial information presented in this release in accordance with accounting principles generally accepted in the United States of America (GAAP), Tempus also presents adjusted non-GAAP financial measures.

Non-GAAP gross profit is defined as GAAP gross profit, excluding stock-based compensation expense and employer payroll tax related to stock-based compensation (collectively, the “stock-based compensation adjustments”). Non-GAAP gross margin is defined as gross profit, excluding the stock-based compensation adjustments, as a percentage of revenue. Non-GAAP operating expenses are calculated as the sum of technology research and development expense, research and development expense, and selling, general and administrative expense, excluding the stock-based compensation adjustments. Non-GAAP net income (loss) is defined as net income (loss), adjusted to exclude (i) losses on equity method investments, (ii) changes in fair value of our warrant liability, warrant asset, marketable equity securities, contingent consideration liabilities and indemnity-related holdback liabilities, and (iv) the payment of $2.3 million of our Series G-4 convertible preferred stock in connection with the initial public offering (the “G-4 Special Payment”). Non-GAAP net income (loss) per share is defined as adjusted net income (loss) divided by weighted average common shares outstanding, basic and diluted.

Adjusted EBITDA is defined as net income (loss), adjusted to exclude (i) interest income, (ii) interest expense, (iii) depreciation and amortization, (iv) provision for (benefit from) income taxes, (v) losses on equity method investments, (vi) changes in fair value of our warrant liability, warrant asset, marketable equity securities, contingent consideration liabilities and indemnity-related holdback liabilities, (vii) the stock-based compensation adjustments, and (Viii) the G-4 Special Payment. Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of revenue.

Tempus believes these non-GAAP financial measures are useful to investors and others because they allow for additional information with respect to financial measures used by management in its financial and operational decision-making and they may be used by institutional investors and the analyst community to help them analyze the health of Tempus’ business. In particular, Adjusted EBITDA is a key measurement used by Tempus management to make operating decisions, including those related to analyzing operating expenses, evaluating performance, and performing strategic planning and annual budgeting. However, there are a number of limitations related to the use of non-GAAP financial measures, and these non-GAAP measures should be considered in addition to, not as a substitute for or in isolation from, our financial results prepared in accordance with GAAP. Other companies, including companies in our industry, may calculate these non-GAAP financial measures differently or not at all, which reduces their usefulness as comparative measures.

Tempus does not provide guidance for net loss, the most directly comparable GAAP measure to Adjusted EBITDA, and similarly cannot provide a reconciliation between its forecasted Adjusted EBITDA and net loss without unreasonable effort due to the unavailability of reliable estimates for certain components of net income and the respective reconciliations. These forecasted items are not within Tempus’ control, may vary greatly between periods and could significantly impact future financial results.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, about Tempus and Tempus’ industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this press release are forward-looking statements, including, but not limited to, Tempus’ expected financial results for full year 2024; the contributions of Tempus’ research and findings to the larger scientific community and the use of Tempus’ products and services to advance clinical care for patients. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “going to,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these words or other similar terms or expressions. Tempus cautions you that the foregoing may not include all of the forward-looking statements made in this press release.

You should not rely on forward-looking statements as predictions of future events. Tempus has based the forward-looking statements contained in this press release primarily on its current expectations and projections about future events and trends that it believes may affect Tempus’ business, financial condition, results of operations and prospects. These forward-looking statements are subject to risks and uncertainties related to: the intended use of Tempus’ products and services; Tempus’ financial performance; the ability to attract and retain customers and partners; managing Tempus’ growth and future expenses; competition and new market entrants; compliance with new laws, regulations and executive actions, including any evolving regulations in the artificial intelligence space; the ability to maintain, protect and enhance Tempus’ intellectual property; the ability to attract and retain qualified team members and key personnel; the ability to repay or refinance outstanding debt, or to access additional financing; future acquisitions, divestitures or investments; the potential adverse impact of climate change, natural disasters, health epidemics, macroeconomic conditions, and war or other armed conflict, as well as risks, uncertainties, and other factors described in the section titled “Risk Factors” in Tempus’ Final Prospectus filed with the Securities and Exchange Commission (“SEC”) on June 17, 2024, pursuant to Rule 424(b)(4) under the Securities Act, as well as in other filings Tempus may make with the SEC in the future, including its Quarterly Report on Form 10-Q for the quarter ended June 30, 2024. In addition, any forward-looking statements contained in this press release are based on assumptions that Tempus believes to be reasonable as of this date. Tempus undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

Tempus AI, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(In thousands, except per share amounts)

				Three Months Ended June 30,						Six Months Ended June 30,
					2024			2023			2024			2023
Net revenue
	Genomics			$	112,324		$	91,924		$	214,893		$	173,982
	Data and services				53,645			40,493			96,896			74,059
		Total net revenue		$	165,969		$	132,417		$	311,789		$	248,041

Cost and operating expenses
	Cost of revenues, genomics				68,324			46,961			121,159			92,241
	Cost of revenues, data and services				22,132			13,807			37,420			25,200
	Technology research and development				77,908			23,427			104,975			46,329
	Research and development				68,025			22,171			92,365			43,034
	Selling, general and administrative				463,072			71,189			542,636			140,236
		Total cost and operating expenses			699,461			177,555			898,555			347,040
	Loss from operations			$	(533,492	)	$	(45,138	)	$	(586,766	)	$	(98,999	)

	Interest income				1,718			1,957			2,749			4,381
	Interest expense				(13,295	)		(11,712	)		(26,533	)		(20,903	)
	Other (expense) income, net				(7,048	)		(766	)		(6,299	)		5,622
	Loss before provision for income taxes			$	(552,117	)	$	(55,659	)	$	(616,849	)	$	(109,899	)
	Provision for income taxes				(95	)		(3	)		(106	)		(9	)
	Losses from equity method investments				-			(170	)		-			(301	)
	Net Loss			$	(552,212	)	$	(55,832	)	$	(616,955	)	$	(110,209	)
		Dividends on Series A, B, B-1, B-2, C, D, E, F, G,
			G-3, and G-4 preferred shares		(11,540	)		(10,897	)		(39,347	)		(21,566	)
		Cumulative Undeclared Dividends on Series C
			preferred shares		(668	)		(745	)		(1,174	)		(1,466	)
	Net loss attributable to common shareholders, basic and
		diluted			(564,420	)		(67,474	)		(657,476	)		(133,241	)
	Net loss per share attributable to common shareholders,
		basic and diluted		$	(6.86	)	$	(1.07	)	$	(9.02	)	$	(2.11	)
	Weighted-average shares outstanding used to compute
		net loss per share, basic and diluted			82,325			63,286			72,930			63,257
Comprehensive Loss, net of tax
		Net loss		$	(552,212	)	$	(55,832	)	$	(616,955	)	$	(110,209	)
		Foreign currency translation adjustment			(43	)		53			(99	)		25
		Comprehensive loss		$	(552,255	)	$	(55,779	)	$	(617,054	)	$	(110,184	)

Tempus AI, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share and per share amounts)

				June 30, 2024			December 31, 2023
Assets
Current Assets
	Cash and cash equivalents			$	478,811		$	165,767
	Accounts receivable, net of allowances of $1,092 and $1,115 at
		June 30, 2024 and December 31, 2023, respectively			118,106			94,462
	Inventory				32,690			28,845
	Warrant asset				800			5,070
	Prepaid expenses and other current assets				29,704			17,295
	Marketable equity securities				11,255			31,807
	Deferred offering costs				-			7,085
			Total current assets	$	671,366		$	350,331
	Property and equipment, net				60,539			61,681
	Goodwill				73,345			73,354
	Warrant asset, less current portion				1,500			4,930
	Intangible assets, net				16,252			21,916
	Investments and other assets				7,677			8,971
	Warrant contract asset, less current portion				19,077			21,499
	Operating lease right-of-use assets				13,994			20,530
	Restricted cash				861			840
Total Assets				$	864,611		$	564,052

Liabilities, Convertible redeemable preferred stock, and Stockholders' equity (deficit)
Current Liabilities
	Accounts payable				28,646			54,421
	Accrued expenses				85,185			82,517
	Deferred revenue				50,905			64,860
	Other current liabilities				7,273			8,213
	Operating lease liabilities				5,828			6,437
	Accrued data licensing fees				3,727			6,382
	Accrued dividends				-			9,797
			Total current liabilities	$	181,564		$	232,627
	Operating lease liabilities, less current portion				27,238			32,040
	Convertible promissory note				180,648			193,124
	Warrant liability				33,600			34,500
	Other long-term liabilities				16,790			19,751
	Interest payable				62,608			55,321
	Long-term debt, net				261,853			256,541
	Deferred revenue, less current portion				2,059			16,768
Total Liabilities				$	766,360		$	840,672

Commitments and contingencies (Note 7)
	Convertible redeemable preferred stock, $0.0001 par value, no and 69,803,765
		shares authorized at June 30, 2024 and December 31, 2023, respectively;
		no and 63,525,953 shares issued and outstanding at June 30, 2024 and
		December 31, 2023, respectively; aggregate liquidation preference of $0
		and $1,130,429 at June 30, 2024 and December 31, 2023, respectively		$	-		$	1,105,543

Stockholders' equity (deficit)
	Class A Voting Common Stock, $0.0001 par value, 1,000,000,000 and
		200,228,024 shares authorized at June 30, 2024 and December 31, 2023,
		respectively; 149,274,923 and 58,367,961 shares issued and outstanding at
		June 30, 2024 and December 31, 2023, respectively		$	15		$	6
	Class B Voting Common Stock, $0.0001 par value, 5,500,000 and 5,374,899
		shares authorized at June 30, 2024 and December 31, 2023, respectively;
		5,043,789 and no shares issued and outstanding at June 30, 2024 and
		December 31, 2023, respectively			1			-
	Non-voting Common Stock, $0.0001 par value, no and 66,946,627 shares
		authorized at June 30, 2024 and December 31, 2023, respectively; no shares
		issued and outstanding at June 30, 2024, and 5,205,802 shares issued and
		5,060,336 shares outstanding at December 31, 2023			-			0
	Treasury Stock, 145,466 shares at June 30, 2024 and December 31, 2023, at cost				(3,602	)		(3,602	)
	Additional Paid-In Capital				2,163,911			18,345
	Accumulated Other Comprehensive (Loss) Income				(94	)		5
	Accumulated deficit				(2,061,980	)		(1,396,917	)
Total Stockholders' equity (deficit)				$	98,251		$	(1,382,163	)
Total Liabilities, Convertible redeemable preferred stock, and Stockholders' equity (deficit)				$	864,611		$	564,052

Tempus AI, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands, except per share amounts)

			Six Months Ended June 30,
				2024			2023
Operating activities
Net loss			$	(616,955	)	$	(110,209	)
Adjustments to reconcile net loss to net cash used in operating activities
	Change in fair value of warrant liability		$	(900	)	$	(5,700	)
	Stock-based compensation			488,313			-
	Gain on warrant exercise			(173	)		-
	Gain on marketable equity securities			(2,541	)		-
	Amortization of original issue discount			691			489
	Amortization of deferred financing fees			255			255
	Change in fair value of contingent consideration			165			-
	Amortization of warrant contract asset			2,422			3,307
	Depreciation and amortization			18,348			16,185
	Provision for bad debt expense			327			1,376
	Change in fair value of warrant asset			7,700			-
	Loss from equity-method investments			-			301
	Amortization of finance right-of-use lease assets			-			190
	Non-cash operating lease costs			3,252			3,382
	Minimum accretion expense			92			187
	Impairment of intangible assets			-			7,359
	PIK interest added to principal			4,366			297
	Change in assets and liabilities
		Accounts receivable		(23,971	)		(6,850	)
		Inventory		(3,845	)		(5,101	)
		Prepaid expenses and other current assets		(12,409	)		(1,634	)
		Investments and other assets		1,294			(4,528	)
		Accounts payable		(33,371	)		(4,195	)
		Deferred revenue		(28,669	)		(19,974	)
		Accrued data licensing fees		(2,749	)		(7,608	)
		Accrued expenses & other		(2,805	)		8,125
		Interest payable		7,287			7,611
		Operating lease liabilities		(4,582	)		(4,352	)
	Net cash used in operating activities		$	(198,458	)	$	(121,087	)

Investing activities
Purchases of property and equipment			$	(14,116	)	$	(15,906	)
Proceeds from sale of marketable equity securities				23,098			-
Business combinations, net of cash acquired (Note 4)				-			(2,869	)
	Net cash provided by (used in) investing activities		$	8,982		$	(18,775	)

Financing activities
Proceeds from issuance of common stock in connection with initial public offering, net of underwriting discounts and commissions			$	381,951		$	-
Tax withholding related to net share settlement of restricted stock units				(69,918	)		-
Issuance of Series G-5 Preferred Stock				199,750			-
Principal payments on finance lease liabilities				-			(192	)
Purchase of treasury stock				-			(3,602	)
Payment of deferred offering costs				(2,714	)		(151	)
Dividends paid				(5,625	)		(5,625	)
Proceeds from long-term debt, net of original issue discount				-			48,750
Payment of indemnity holdback related to acquisition				(813	)		-
	Net cash provided by financing activities		$	502,631		$	39,180
	Effect of foreign exchange rates on cash		$	(90	)	$	28

Net increase (decrease) in Cash, Cash Equivalents and Restricted Cash			$	313,065		$	(100,654	)
Cash, cash equivalents and restricted cash, beginning of period				166,607			303,731
Cash, cash equivalents and restricted cash, end of period			$	479,672		$	203,077


Cash, Cash Equivalents and Restricted Cash are Comprised of:
	Cash and cash equivalents		$	478,811		$	202,266
	Restricted cash and cash equivalents			861			811
Total cash, cash equivalents and restricted cash			$	479,672		$	203,077

Supplemental disclosure of cash flow information
	Cash paid during the year for interest		$	13,921		$	5,691
	Cash paid for income taxes		$	89		$	41

Supplemental disclosure of noncash investing and financing activities
	Dividends payable		$	5,487		$	4,545
	Purchases of property and equipment, accrued but not paid		$	1,108		$	2,952
	Deferred offering costs, accrued but not yet paid		$	6,051		$	2,917
	Redemption of convertible promissory note		$	12,476		$	13,926
	Non-voting common stock issued in connection with business combinations		$	344		$	4,305
	Operating lease liabilities arising from obtaining right-of-use assets		$	-		$	892
	Conversion of redeemable convertible preferred stock to common stock in connection with initial public offering		$	1,348,809		$	-
	Taxes related to net share settlement of restricted stock units not yet paid		$	164		$	-
	Reclassificiation of deferred offering costs to additional paid-in capital upon initial public offering		$	12,347		$	-
	Issuance of Series G-3 Preferred Stock		$	3,809		$	2,738
	Issuance of Series G-4 Preferred Stock		$	611		$	-

Tempus AI, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands, except percentages and per share amounts)


Genomics Gross Profit & Gross Margin
		Three Months Ended June 30,						Six Months Ended June 30,
			2024			2023			2024			2023
	Genomics revenue	$	112,324		$	91,924		$	214,893		$	173,982
	Cost of revenues, genomics		68,324			46,961			121,159			92,241
Gross profit, genomics		$	44,000		$	44,963		$	93,734		$	81,741
	Stock-based compensation expense		11,327			-			11,327			-
	Employer payroll tax related to stock-based compensation		136			-			136			-
Non-GAAP gross profit, genomics		$	55,463		$	44,963		$	105,197		$	81,741

Genomics gross margin			39.2	%		48.9	%		43.6	%		47.0	%
	Stock-based compensation expense		10.1	%		0.0	%		5.3	%		0.0	%
	Employer payroll tax related to stock-based compensation		0.1	%		0.0	%		0.1	%		0.0	%
Non-GAAP gross margin, genomics			49.4	%		48.9	%		49.0	%		47.0	%


Data and Services Gross Profit & Gross Margin
		Three Months Ended June 30,						Six Months Ended June 30,
			2024			2023			2024			2023
	Data and services revenue	$	53,645		$	40,493		$	96,896		$	74,059
	Cost of revenues, data and services		22,132			13,807			37,420			25,200
Gross profit, data and services		$	31,513		$	26,686		$	59,476		$	48,859
	Stock-based compensation expense		7,229			-			7,229			-
	Employer payroll tax related to stock-based compensation		119			-			119			-
Non-GAAP gross profit, data and services		$	38,861		$	26,686		$	66,824		$	48,859

Gross margin, data and services			58.7	%		65.9	%		61.4	%		66.0	%
	Stock-based compensation expense		13.5	%		0.0	%		7.5	%		0.0	%
	Employer payroll tax related to stock-based compensation		0.2	%		0.0	%		0.1	%		0.0	%
Non-GAAP gross margin, data and services			72.4	%		65.9	%		69.0	%		66.0	%


Total Gross Profit & Gross Margin
		Three Months Ended June 30,						Six Months Ended June 30,
			2024			2023			2024			2023
	Net revenue	$	165,969		$	132,417		$	311,789		$	248,041
	Cost of revenues		90,456			60,768			158,579			117,441
Gross profit		$	75,513		$	71,649		$	153,210		$	130,600
	Stock-based compensation expense		18,556			-			18,556			-
	Employer payroll tax related to stock-based compensation		255			-			255			-
Non-GAAP gross profit		$	94,324		$	71,649		$	172,021		$	130,600

Gross margin			45.5	%		54.1	%		49.1	%		52.7	%
	Stock-based compensation expense		11.2	%		0.0	%		6.0	%		0.0	%
	Employer payroll tax related to stock-based compensation		0.2	%		0.0	%		0.1	%		0.0	%
Non-GAAP gross margin			56.8	%		54.1	%		55.2	%		52.7	%

Operating Expenses


	Three Months Ended June 30,				Six Months Ended June 30,
		2024		2023		2024		2023
Technology Research and Development	$	77,908	$	23,427	$	104,975	$	46,329
Stock-based compensation expense		50,434		-		50,434		-
Employer payroll tax related to stock-based compensation		1,248		-		1,248		-
Non-GAAP technology research and development	$	26,226	$	23,427	$	53,293	$	46,329

Research and development	$	68,025	$	22,171	$	92,365	$	43,034
Stock-based compensation expense		42,233		-		42,233		-
Employer payroll tax related to stock-based compensation		676		-		676		-
Non-GAAP research and development	$	25,116	$	22,171	$	49,456	$	43,034

Selling, general and administrative	$	463,072	$	71,189	$	542,636	$	140,236
Stock-based compensation expense		377,090		-		377,090		-
Employer payroll tax related to stock-based compensation		2,582		-		2,582		-
Non-GAAP selling, general and administrative	$	83,400	$	71,189	$	162,964	$	140,236

Operating expenses	$	609,005	$	116,787	$	739,976	$	229,599
Stock-based compensation expense		469,757		-		469,757		-
Employer payroll tax related to stock-based compensation		4,506		-		4,506		-
Non-GAAP operating expenses	$	134,742	$	116,787	$	265,713	$	229,599

Earnings per Share

	Three Months Ended June 30, 2024			Six Months Ended June 30, 2024
Net loss	$	(552,212	)	$	(616,955	)
Fair value changes⁽¹⁾		4,870			4,280
Stock-based compensation expense		488,313			488,313
Employer payroll tax related to stock-based compensation		4,762			4,762
G-4 Special Payment		2,250			2,250
Non-GAAP net loss	$	(52,017	)	$	(117,350	)
Non-GAAP net loss per share	$	(0.63	)	$	(1.61	)
Weighted average common shares outstanding, basic and diluted		82,325			72,930

⁽¹⁾Fair value changes include gains and losses related to quarterly fair value adjustments of our warrant liability, warrant asset, marketable equity securities, contingent consideration liabilities, and indemnity-related holdback liabilities.

Adjusted EBITDA

		Three Months Ended June 30,						Six Months Ended June 30,
			2024			2023			2024			2023
Net loss		$	(552,212	)	$	(55,832	)	$	(616,955	)	$	(110,209	)
	Interest income		(1,718	)		(1,957	)		(2,749	)		(4,381	)
	Interest expense		13,295			11,712			26,533			20,903
	Depreciation		6,415			5,194			12,684			10,254
	Amortization		2,744			3,043			5,664			5,931
	Provision for income taxes		95			3			106			9
EBITDA		$	(531,381	)	$	(37,837	)	$	(574,717	)	$	(77,493	)
	Losses on equity method investments		-			170			-			301
	Fair value changes⁽¹⁾		4,870			700			4,280			(5,700	)
	Stock-based compensation expense		488,313			-			488,313			-
	Employer payroll tax related to stock-based compensation		4,762			-			4,762			-
	G-4 Special Payment		2,250			-			2,250			-
Adjusted EBITDA		$	(31,186	)	$	(36,967	)	$	(75,112	)	$	(82,892	)

View source version on businesswire.com: https://www.businesswire.com/news/home/20240806760449/en/

Tempus Communications

Erin Carron

media@tempus.com

Tempus Investor Relations

Elizabeth Krutoholow

Elizabeth.krutoholow@tempus.com

H/Advisors Abernathy

Dan Scorpio

Dan.scorpio@h-advisors.global

Source: Tempus AI, Inc.

FAQ

What was Tempus AI's (TEM) revenue for Q2 2024?

Tempus AI (TEM) reported revenue of $166.0 million for Q2 2024, representing a 25% increase year-over-year.

How much did Tempus AI (TEM) raise in its initial public offering?

Tempus AI (TEM) raised $410.7 million in gross proceeds from its initial public offering, selling 11,100,000 shares of Class A common stock at $37 per share.

What is Tempus AI's (TEM) revenue guidance for full year 2024?

Tempus AI (TEM) expects full year 2024 revenue of approximately $700 million, which represents approximately 32% year-over-year growth.

What was Tempus AI's (TEM) net loss for Q2 2024?

Tempus AI (TEM) reported a net loss of ($552.2 million) for Q2 2024, largely driven by $493.1 million of stock compensation expense and related employer payroll taxes tied to the initial public offering.

What new market did Tempus AI (TEM) expand into in Q2 2024?

Tempus AI (TEM) expanded into the minimal residual disease (MRD) market with the launch of both tumor-naïve and tumor-informed assays in Q2 2024.

Tempus Reports Second Quarter 2024 Results

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Tempus Reports Second Quarter 2024 Results

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Financial Analyst neutral

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FAQ

What was Tempus AI's (TEM) revenue for Q2 2024?

How much did Tempus AI (TEM) raise in its initial public offering?

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What new market did Tempus AI (TEM) expand into in Q2 2024?

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