How Tempus AI Is Advancing Toward Regulatory Pricing Catch-Up

Tempus AI’s TEM reimbursement showed modest sequential improvement in the third quarter of 2025, though average blended reimbursement per test continues to lag peers by a meaningful margin. The company has several structural catalysts that could help narrow this pricing gap over time. Tempus exited the quarter with approximately one-third of xT CDx volume already on the FDA-approved or Advanced Diagnostic Laboratory Test (ADLT) pathway. Management also expects to submit the xF assay for FDA approval by the end of 2025, which would make it eligible for ADLT status, with the xR assay expected to follow. MRD reimbursement is progressing as planned and is expected to scale gradually, while regulatory submissions and ADLT migrations through 2025–2026 outline a clear path to improving pricing and unit economics.While the strategic roadmap is clear, execution risk remains elevated, given the dependence on regulatory review timelines. The magnitude and cadence of ADLT-related pricing uplift will not be known until approvals are secured, leaving near-term per-test economics below peer levels. Prolonged reviews, reimbursement delays, or adverse payer policy changes could defer the expected pricing convergence and slow margin expansion.Peer UpdateDoximity DOCS commands an unmatched footprint across the U.S. medical community, with over 80% of physicians and 60% of NPs and PAs as members. This scale creates a powerful network effect that enhances the platform’s stickiness and advertising effectiveness. As healthcare becomes more digitized and mobile, Doximity's first-mover advantage and deep relationships with its user base position it as the go-to B2B healthcare engagement platform. Beyond its original media model, DOCS has scaled into hiring solutions, workflow tools, and telehealth — now addressing an $18.55B U.S. TAM. With a largely fixed cost structure and high incremental margins, Doximity is capital-efficient and highly cash-generative. Illumina ILMN unveiled a strategic roadmap aimed at returning to growth and boosting profitability. ILMN expects high-single-digit revenue growth by 2027 and double-digits to teens annual EPS growth over the next three years. Underpinning these targets are three pillars - growing the core sequencing business, scaling into multiomics and expanding services, data and software capabilities. In the third quarter, Illumina achieved its year-end targets for NovaSeq X transition, with more than 75% of high-throughput gigabases shipped and more than 50% of high-throughput revenues on the platform. Based on its agreement to acquire SomaLogic, the company launched Illumina Protein Prep. It had also announced its capabilities in single-cell, CRISPR-based Perturb-Seq and spatial analysis.TEM’s Stock Price PerformanceOver the past year, Tempus’ shares have rallied 84.8% against the industry’s 1.5% decline. The S&P 500 composite has improved 16.8% in the same time frame.Image Source: Zacks Investment ResearchExpensive ValuationTEM currently trades at a forward 12-month Price-to-Sales (P/S) of 7.35X compared with the industry average of 5.77X.Image Source: Zacks Investment ResearchTEM Stock Estimate TrendIn the past 30 days, Tempus AI's loss per share estimate for 2025 has narrowed 1 cent to 64 cents. Image Source: Zacks Investment ResearchTEM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Naming Top 10 Stocks for 2026Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%.Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Illumina, Inc. (ILMN): Free Stock Analysis Report Doximity, Inc. (DOCS): Free Stock Analysis Report Tempus AI, Inc. (TEM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks