Tempus AI Stock Before Q2 Earnings Release: To Buy, Hold or Sell?

The Zacks Consensus Estimate for revenues is currently pegged at $381.6 million, implying a 21.3% improvement from the year-ago period’s level.

The consensus estimate for loss per share has moved south to 12 cents over the past 30 days.

TEM's Earnings Estimate Revision Trend

Image Source: Zacks Investment Research

During the second quarter, Tempus’ share price experienced 23.2% growth, mainly due to a series of strategic acquisitions and partnerships in the field of AI-driven precision medicine, as well as a slew of product launches. Yet, the company is expected to have incurred loss during the second quarter, caused by macroeconomic challenges, including escalating trade tensions that broadly affected the healthcare technology sector. 

The Zacks Medical Info Systems industry and the S&P 500 benchmark index gained 21.5% and 14.4%, respectively, during the second quarter. Other industry players, such as 10x Genomics TXG and SOPHiA GENETICS SOPH, gained 73.9% and 13.4%, respectively.

TEM's Q2 Price Performance Comparison

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Let’s see how things might have shaped up for TEM prior to the announcement:

Key Factors to Note Prior to Tempus' Q2 Earnings

In the second quarter, we expect Tempus’ Diagnostics segment’s sales to have experienced an improvement from accelerating volume growth in oncology testing and sustained strength in hereditary sequencing. The Data and Applications business is likely to have experienced strong demand for Tempus’ proprietary data licensing and AI solutions.

Tempus’ first-quarter gross profit saw a 43.1% year-over-year improvement, while adjusted EBITDA was negative. However, the company expects positive adjusted EBITDA of $65 million in 2026. We expect the company to have progressed meaningfully in the to-be-reported quarter. 

In the second quarter of 2026, Tempus expanded its multi-year collaboration with Gilead Sciences (GILD), providing enterprise-wide access to its AI-powered Lens platform, broader multi-indication datasets and dedicated analytical services to support Gilead's oncology pipeline and inform clinical decision-making. The company also expanded its partnership with Predicta Biosciences to commercially launch the co-branded GenoPredicta whole-genome sequencing assay for comprehensive genomic characterization of hematologic malignancies and measurable residual disease monitoring. 

Tempus initiated a collaboration with Bristol Myers Squibb (BMY) to use AI, multimodal real-world data and data science to optimize clinical trial designs and improve the Probability of Technical & Regulatory Success across five initial programs. Separately, Tempus partnered with Angiosarcoma Awareness to advance data-driven research in angiosarcoma, a rare and aggressive cancer. These collaborations might have helped Tempus establish a strong footprint in oncology with an industry-leading technology portfolio.

From an R&D perspective, in the second quarter of 2026, the company launched the ArteraAI Prostate Test (mHSPC), a CLIA-certified and CAP-accredited prognostic test integrated into the Tempus platform to help urologists and oncologists personalize therapy intensity for patients with metastatic hormone-sensitive prostate cancer. It also introduced an automated clinical update service through its AI-enabled Hub physician portal, enabling active follow-up, ongoing therapy monitoring and context-aware notifications. 

Tempus launched Tempus Preview, which delivers preliminary mutation predictions within approximately 24 hours of tissue receipt, bridging the gap between test ordering and final sequencing results. We expect these developments to have boosted the company’s top-line growth. 

Investments tied to these updates, including product development and collaborations, are likely to have pushed operating expenses higher in the second quarter, putting some pressure on short-term profitability. Broader macroeconomic factors, like tariffs, hospital budget constraints and biotech funding trends, might have also affected adoption rates.

Discounted Valuation

Tempus stock is currently discounted compared with its industry, as shown in the chart below.

TEM is currently trading at a forward 12-month price-to-sales (P/S) ratio of 4.56X, lower than its industry's median of 4.77X.

Image Source: Zacks Investment Research

Our Take 

Tempus entered the second quarter of 2026 with solid momentum, supported by strong diagnostics demand, expanding AI-driven collaborations and continued product innovation. While elevated investments and macroeconomic headwinds might have weighed on near-term margins, sustained execution across its oncology and data businesses is expected to have supported healthy revenue growth and progress toward its long-term profitability goals.

Given the discounted valuation trend and stock price surge, we advise investors who already hold this Zacks Rank #3 (Hold) stock to maintain their positions, while prospective investors may consider waiting for a more favorable entry point. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research