NEW YORK – Tempus AI on Tuesday announced that its Q2 2024 revenues rose 25 percent year over year.
In its first quarter as a public company after its $410.7 million initial public offering in June, Tempus reported revenues of $166.0 million for the quarter ended June 30, up from $132.4 million in Q2 2023 and beating the Wall Street consensus estimate of $160.8 million.
Genomics revenues increased 22 percent to $112.3 million in Q2 2024 from $91.9 million in Q2 2023, while data and services revenue rose nearly 33 percent to $53.6 million from $40.5 million in the year-ago quarter.
According to a statement published on the company's website, Tempus ran approximately 66,500 next-generation sequencing tests in the second quarter, up from about 62,700 in Q1 2024 and 55,300 in Q2 2023. The firm said it expects its 2024 growth rates in the genomics business, both on a unit and revenue basis, to be in the 25 percent to 30 percent range. Tempus CEO Eric Lefkofsky said on a conference call to discuss the firm's financial results that he expects the sequential quarterly growth in volume to continue, even though there is "obviously some seasonality." He added that Tempus feels the core genomics business "is performing as we expected."
The genomics business growth was largely driven by 20 percent volume growth in the clinical oncology business, the firm noted. Average reimbursement per clinical oncology report was approximately $1,500 in the quarter — an increase of $50 per report from Q1 2024, driven by a shift in the payor mix and increases in the reimbursement for the xG assay. Tempus CFO Jim Rogers added that there was a slight shift in the payor mix in Q2 toward more Medicare and Medicare Advantage patients, who are typically reimbursed at a higher rate than commercial payors.
The data and services revenue growth was largely driven by the Insights data licensing business, which grew faster than the Services clinical trials business. Rogers noted that the Insights business made up about 75 percent of the revenues for the data and services business.
The Chicago-based firm saw a net loss of $552.2 million, or $6.86 per share, compared to a loss of $55.8 million, or $1.07 per share, in the prior-year quarter. The increase was driven by $493.1 million of stock compensation expense and related employer payroll taxes tied to its IPO, Tempus said in a separate statement.
Tempus ended the quarter with cash and cash equivalents of $478.8 million and $11.3 million in marketable equity securities.
The company said it expects full-year 2024 revenue of approximately $700 million, an increase of about 32 percent compared to 2023.