Tempus AI, Inc. (NASDAQ: TEM) saw a substantial rise in its stock value on Wednesday, climbing 28.02% to close at $56.97. This surge followed the release of the company’s quarterly earnings report and an announcement regarding a strategic merger with Ambry Genetics.
Strong Quarterly Performance with Revenue Growth
Tempus AI (TEM) delivered a solid performance this quarter, driven by growth across its business segments. The company’s revenues rose by 33%, reaching $180.9 million, highlighting its increasing market influence, particularly in the genomics and data services sectors.
Within its data division, specifically under the Insights business, Tempus demonstrated robust acceleration in revenue, signaling strong demand for its clinical and genomic analytics services.
Despite a net loss of $75.84 million—up from $53.4 million the previous year—the financial impact was primarily due to $493.1 million in stock compensation and related employer taxes. Notably, the Genomics unit showed impressive annual growth, rising 23.9% with increased average revenue per clinical test.
Strategic Acquisition of Ambry Genetics
Tempus also announced a key acquisition of Ambry Genetics, a leading genetic testing provider. Through this purchase, Tempus will be able to offer a wider variety of services to its biotech and pharmaceutical clients in addition to expanding its genetic testing offering. The deal states that Tempus would pay $375 million in cash and $225 million in shares to purchase Ambry, with the remaining $100 million being locked up for a year.
Developing Clinical Skills for Cancer Screening
As the primary reference lab for Tempus in the field of hereditary cancer screening, Ambry Genetics is a major player in this area. Through this purchase, Tempus will be able to offer cancer risk testing, which is an essential service for medical professionals who treat patients who have hereditary cancer predispositions.
Broader Disease Coverage and Innovation Potential
With Ambry’s wide range of products, Tempus will be able to expand into new medical fields outside of cancer, such as pediatrics, immunology, uncommon illnesses, women’s reproductive health, and cardiology. This purchase supports Tempus’ objective of using data-driven innovation to further scientific and clinical research, which will ultimately give medical professionals better tools for making decisions.