Tempus AI (TEM) is a high-growth healthcare data and AI company that is losing money today but losing it at a rapidly improving rate relative to its revenue. The business has nearly quadrupled its top line in just three years — from $321 million in 2022 to $1.27 billion in 2025 — and its most recent quarter shows the clearest sign yet that the path to profitability is real: net income turned slightly positive in Q2 2026. Operating losses as a percentage of revenue have compressed dramatically, from roughly 83% of revenue in 2022 to under 20% in 2025 and in the latest quarter. Liquidity is healthy, with a current ratio above 3x. Capital expenditures are modest and falling as a share of revenue, suggesting the business does not require heavy physical reinvestment to scale. The story here is a classic high-growth, pre-profit technology platform: the key question investors face is whether revenue momentum can outrun cash burn long enough to reach sustainable profitability — and the recent data, while not yet conclusive, points in an encouraging direction.
Snapshot & Big Picture
Tempus AI operates at the intersection of genomics, clinical data, and artificial intelligence, providing tools and insights primarily to oncology and other healthcare providers. The company went public and has been scaling aggressively, reinvesting heavily into its platform. Over the three fiscal years from 2022 through 2025, revenue grew at a 3-year CAGR of approximately 58.3% — an exceptional pace by any standard. The trade-off has been persistent operating losses, though the margin trajectory is clearly improving. Gross margin data was not reported in a way that could be separately derived from the available filings, so that specific metric is not available here.
| Fiscal Year | Revenue | EBITDA | Operating Margin | Net Margin |
|---|---|---|---|---|
| 2022 | $320.7M | -$248.7M | -82.8% | -90.4% |
| 2023 | $531.8M | -$174.8M | -36.9% | -40.3% |
| 2024 | $693.4M | -$664.7M | -99.7% | -101.8% |
| 2025 | $1,271.8M | -$220.8M | -19.9% | -19.3% |
The 2024 fiscal year stands out as an outlier — EBITDA and net margin deteriorated sharply, likely reflecting significant non-cash charges or one-time costs (such as stock-based compensation or impairments around or following the IPO process) rather than a fundamental reversal of the operating trend. The 2025 numbers then show a dramatic normalization and improvement, consistent with the underlying business scaling into a more efficient cost structure.
Latest Quarter Snapshot
The most recent data — Q2 2026, ending June 30, 2026, filed July 30, 2026 — is more current than the annual figures and provides the clearest real-time read on Tempus AI's trajectory. Revenue came in at $382.5 million for the quarter alone, putting the business on an annualized run rate of roughly $1.5 billion if the pace holds. More notably, the net margin turned slightly positive at approximately 1.5%, marking a meaningful milestone. The operating margin remained modestly negative at -19.8%, indicating that the positive net income likely reflects items below the operating line (such as interest income or investment gains) rather than fully operational profitability — but the direction is unmistakably improving. The current ratio strengthened further to 3.30x, reflecting a solid liquidity position.
| Metric | Q2 2026 (Quarter Ended June 30, 2026) |
|---|---|
| Revenue | $382.5M |
| EBITDA | -$68.8M |
| Operating Margin | -19.8% |
| Net Margin | +1.5% |
| Current Ratio | 3.30x |
| CapEx | $8.2M |
| CapEx / Revenue | 2.1% |
Profitability
The multi-year profitability trend for Tempus AI shows meaningful improvement when viewed from 2022 through 2025, with a notable detour in 2024. Operating margin improved from -82.8% in 2022 to -36.9% in 2023, before widening again sharply to -99.7% in 2024 — an anomaly almost certainly driven by non-recurring charges rather than operational deterioration — and then compressing dramatically to -19.9% in 2025. The Q2 2026 operating margin of -19.8% suggests this improved level is being sustained into the current fiscal year. EBITDA losses followed a similar pattern: large in 2022 (-$248.7M), moderating in 2023 (-$174.8M), spiking in 2024 (-$664.7M), and then returning to a more contained -$220.8M in 2025. Gross margin data was not separately available in the filing data provided. The overall arc — if 2024 is treated as a one-time disruption — is one of steady operating leverage as revenue scales faster than costs.
Financial Health
Tempus AI's balance sheet liquidity has improved consistently. The current ratio rose from 1.51x at end of 2023, to 2.29x at end of 2024, to 3.13x at end of 2025, and further to 3.30x as of Q2 2026. This suggests the company is not in near-term liquidity stress. Debt-to-equity data was not available in the filings for any period reviewed, so leverage cannot be assessed from this data set.
Capital expenditures have been modest and are declining as a share of revenue — a positive signal that Tempus AI's platform is not capital-intensive to scale in the traditional infrastructure sense:
| Period | CapEx ($) | CapEx / Revenue |
|---|---|---|
| FY 2022 | $18.4M | 5.7% |
| FY 2023 | $34.6M | 6.5% |
| FY 2024 | $22.1M | 3.2% |
| FY 2025 | $21.0M | 1.7% |
| Q2 2026 (single quarter) | $8.2M | 2.1% |
The CapEx-to-revenue ratio peaked at 6.5% in 2023 and has since fallen to under 2% by 2025. This trend implies that incremental revenue is being generated without proportional physical reinvestment, consistent with a software and data platform business model where the primary reinvestment goes into people and R&D rather than hard assets. At current quarterly run rates, annualized CapEx would be roughly $33 million — still very low relative to a $1.5 billion revenue run rate.
Growth
| CAGR Window | Start Fiscal Year | End Fiscal Year | Start Revenue | End Revenue | CAGR |
|---|---|---|---|---|---|
| 3-Year | FY 2022 | FY 2025 | $320.7M | $1,271.8M | 58.3% |
| 5-Year | N/A | N/A | N/A | N/A | Not available — insufficient SEC filing history |
| 10-Year | N/A | N/A | N/A | N/A | Not available — insufficient SEC filing history |
The 5-year and 10-year CAGRs are not available because Tempus AI's SEC filing history does not extend back far enough to compute them — the company is a relatively recent public filer. The 3-year revenue CAGR of 58.3% is exceptional and reflects a business that has roughly quadrupled its revenue in three years; sustaining even a fraction of that pace would make Tempus AI one of the faster-growing companies at this revenue scale in healthcare technology.
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