Tempus AI Stock Underperforming Into Earnings – What To Expect After The Bell

Tempus AI reports fourth-quarter 2025 results today after market close, with Wall Street focused on profitability trajectory and 2026 guidance following the company’s preliminary revenue disclosure of $367M.

The TEM stock price has fallen ~17% over the past 12 months, leaving bulls nursing underperformance against broader markets. What can we expect from here?

The setup reflects a year-long estimate revision cycle in which consensus revenue expectations climbed $210M from $1.04B in late February 2025 to $1.25B by Q2, forcing analysts to re-underwrite the growth rate as Ambry Genetics integration and Data/Insights monetization accelerated.

Tempus delivered four consecutive adjusted EPS beats through 2025, yet the stock sold off 45% from its October peak near $104 as investors recalibrated expectations around cash burn, operating expense discipline, and the timeline to positive operating income.

What the Q4 result determines is whether Tempus can articulate a credible multi-quarter path to operating leverage while maintaining 70%+ revenue growth, or whether the model requires sustained losses to defend its competitive position in the $40B precision oncology market.

Management’s 2026 guidance will set the constraint: any deceleration in Data/Insights growth or margin compression from continued Diagnostics investment would challenge the valuation premium embedded in the current 39% analyst upside target.

Consensus Estimates

Consensus expectations reflect a structural deterioration in near-term profitability estimates despite revenue tracking to the pre-announced $367M. Adjusted EPS estimates declined 17% over the past week and 9% over the past two months, suggesting analysts are incorporating higher operating expenses or lower-than-expected margin contribution from the revenue mix. The $0.17 midpoint loss represents a 55% widening from Q3’s $0.11 loss, a reversal that contradicts the sequential improvement narrative established through the first three quarters of 2025.

Management Guidance & Commentary

“We achieved record revenue of approximately $367 million in the fourth quarter, representing 83% year-over-year growth, and approximately $1.27 billion for the full year 2025, representing 70% year-over-year growth. We continue to see strong momentum across our Diagnostics and Data and Applications businesses.”

Management’s January preliminary disclosure emphasized revenue momentum and cross-segment strength but provided no quantified profitability metrics or 2026 outlook. The company framed Q4 as a “record quarter” while highlighting total contract value exceeding $1.1B, a metric intended to signal forward revenue visibility. The absence of adjusted EBITDA or operating margin commentary in the preliminary release stands in contrast to Q3’s explicit callout of positive adjusted EBITDA, suggesting either Q4 profitability did not meet the Q3 milestone or management is reserving margin discussion for the full earnings call.

Management’s 2026 outlook will determine whether the 70% revenue growth rate is sustainable or represented a peak driven by Ambry integration

Sector & Peer Comparison

Tempus commands a $10.2B market capitalization despite posting losses, positioning it between Exact Sciences ($11.2B) and Guardant Health ($4.8B) in the precision oncology diagnostics peer set. The company’s 70% revenue growth rate is 2.5x Guardant’s 28% and nearly 5x Exact Sciences’ 15%, justifying a valuation premium on a growth basis but raising questions about sustainability as the Ambry integration anniversary approaches.

Earnings Track Record

Tempus has delivered four consecutive adjusted EPS beats since its Q4 2024 report, with losses consistently less negative than consensus by an average of 29%. The Q3 2025 beat of 35% (actual -$0.11 vs estimate -$0.17) represents the largest surprise in the company’s public reporting history, driven by the positive adjusted EBITDA milestone that exceeded Street expectations for profitability timing.

Post-Earnings Price Movement History

Post-earnings price reactions for Tempus have been guidance-driven rather than results-driven, with the Q3 2025 selloff (down 3.1% despite a 35% EPS beat) demonstrating that execution alone does not sustain the stock without forward visibility. The Q3 2025 reaction is the critical data point: the largest EPS beat in company history coincided with a selloff, indicating the market discounted the profitability milestone and focused on what management did not provide in terms of 2026 margin trajectory.

Expected Move & Implied Volatility

The options market prices a 12% expected move ($50.40 to $64.18 range), materially above the -0.3% average historical next-day move and consistent with the 72nd percentile implied volatility reading. The elevated IV percentile reflects uncertainty around 2026 guidance and whether management can articulate a credible path to sustained profitability.

Expert Predictions & What to Watch

Key Outlook: Guidance Will Drive the Trade

Data and Applications revenue grew 31% in FY2025, with the segment’s margin profile critical to Tempus’s path to profitability

Key Metrics to Watch

The Q4 earnings call will be the first opportunity for management to provide a complete 2026 financial framework following the preliminary revenue disclosure. Investors will scrutinize not just the guidance figures but the underlying assumptions: what revenue growth rate is embedded in the outlook, what margin expansion is achievable given the current cost structure, and when the company expects to reach positive operating income on a sustained basis.