Tempus AI's 89% Genomics Surge: Will the Momentum Keep Building?

AI in healthcare company Tempus AI TEM delivered $193.8 million in Genomics revenues in the quarter ended March 2025, which increased nearly 89% year over year. The business benefited from 20% volume growth in oncology tests (legacy Tempus clinical testing) and higher average revenue per test due to increased Medicare reimbursement rates. Additionally, hereditary testing contributed $63.5 million in Genomics revenues on 23% volume growth from the February acquisition of Ambry Genetics. Tempus is now building on that momentum with more promising developments.The company’s new liquid biopsy assay, xM for treatment response monitoring (TRM), is set to be launched clinically in the coming months. Aimed at both clinicians and biopharma researchers, the test is designed to track changes in the quantitative tumor fraction timely while patients receive immune-checkpoint inhibitor (ICI) therapies. xM for TRM detects a molecular response to ICI within the first six weeks of treatment — a critical advantage, particularly for patients with advanced disease — and can significantly influence treatment decisions. We believe this positions the assay well for driving future Genomics growth.Further, the company’s first whole-genome sequencing (WGS) test, Xh, is also set to be launched clinically by next year. The offering is designed to help clinicians detect all clinically relevant variants and advance the personalized treatment landscape, specifically in hematological oncology.Tempus is also developing a companion diagnostic (CDx) test with Verastem Oncology VSTM, having completed confirmatory testing in VSTM’s Phase 2 RAMP-201 clinical trial. The study evaluated the combination of avutometinib and defactinib to treat recurrent low-grade serous ovarian cancer (LGSOC). And now, Tempus’ FDA-approved xT CDx assay is being leveraged as an investigational assay in Verastem’s global Phase 3 RAMP-301 clinical trial.Updates From TEM’s Genomic PeersGuardant Health GH demonstrated strong momentum in the first quarter of 2025, with oncology revenues growing 20% year over year on a 25% increase in test volumes. In May, GH launched the Guardant Hereditary Cancer test, which identifies genetic variants associated with cancer risk. Further, Guardant Health’s newly introduced, advanced molecular profiling test requires 40% fewer tissue slides than the industry norm, allowing testing of more patients with less precious tissue.Exact Sciences EXAS continues to gain from the robust international adoption of its Oncotype DX genomic test. EXAS’ tumor-informed molecular residual disease (MRD) test, Oncodetect, has been validated in predicting recurrence in stage II–IV colorectal cancer, confirming its role in supporting treatment and surveillance decisions. Exact Sciences launched Cologuard Plus, which features novel genetic biomarkers and is expected to reduce false positives by more than 40% compared to the original Cologuard test.TEM’s Price Performance, Valuation and EstimatesYear to date, Tempus AI shares have surged 105.3% compared with the industry’s 28% growth.Image Source: Zacks Investment ResearchTempus AI is trading at a forward 12-month Price-to-Sales (P/S) of 8.60X compared to the industry average of 6.02X. It carries a Value Score of F.Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for Tempus AI’s 2025 earnings has been trending upward over the past 90 days.Image Source: Zacks Investment ResearchTEM stock currently carries a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>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 Exact Sciences Corporation (EXAS): Free Stock Analysis Report Verastem, Inc. (VSTM): Free Stock Analysis Report Guardant Health, Inc. (GH): 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