What Is Tempus AI Building That Investors Should Watch?
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Tempus AI (TEM) stock rose 63.9% between August 6 and November 4, 2026, while the S&P 500 barely moved. Its biggest one-day gain in that stretch, 24.1% on August 19, came in a week that news reports tied to a Merck and Moderna clinical-trial headline. Diagnostic tests still account for most of its sales, but buyers may be betting on a decade of patient data that drugmakers pay to use. For that bet to hold up, drugmakers have to keep signing deals, and data sales have to keep growing faster than tests. So is that data business catching on?
Tempus AI Is Signing Multi-Year Data Deals
So far, yes. Since its previous quarterly call, Tempus entered a collaboration with Bristol Myers Squibb worth up to $138 million over five years. Pathos is also paying Tempus $55 million over a five-year term. Management expects those two agreements alone to add $193 million of data and applications revenue over about the next five years. That figure is a forecast, not revenue Tempus has reported.
These deals fall under data licensing, a business Tempus calls Insights. Over the past half decade, management said the company has moved customers to long-term subscriptions on its Lens platform, where clients can download a set number of patient files each year. Insights revenue grew 29% in the third quarter of 2026, which ended September 30.
Tempus also continues to expand what it sells. The company holds more than 600 petabytes of data, and it added more than 50 petabytes in the third quarter alone.
How Big Is Tempus AI’s Data Business?
Tempus’s data and apps business, which includes Insights, brought in $108 million in the third quarter, compared with $304 million from diagnostics. Data remains the smaller business, but it is growing faster. Data and apps revenue rose 33% from a year earlier, while diagnostics grew 20%. If that gap holds, data will make up a larger share of sales each year.
Spread over about five years, the two new deals are also small next to the $1,509 million of revenue Tempus reported over the last twelve months.
The share price appears to assume a lot of growth already. Tempus trades at 9.1 times its sales over the last twelve months, compared with 3.2 times for the S&P 500. The shares peaked during the rally, and they closed on November 4 at 11.1% below their September 28 high of $85.08. Over the twelve months to November 4, the stock lost 10.5%, while the S&P 500 returned 14.9%.
What Could Hold Tempus AI’s Data Business Back?
From a deal’s size alone, you cannot see whether customers stay once a contract ends. That question came up on the November 2 call. Management said the business has gone from “not sticky to crazy sticky” now that customers work inside Tempus’s own products instead of simply downloading files. That is management’s view.
Tempus also still loses money on its operations, though less than a year ago. Its operating margin was -13.8% in the third quarter, compared with -18.3% in the same quarter a year earlier. The company is about to take on more losses. Tempus is buying Personalis, whose tests lose money today, management said. Personalis shareholders vote on the deal on November 30.
If drugmakers stop signing, or data sales grow too slowly to make up for those losses, you are left owning what is still mainly a diagnostics company.
Drugmakers are still signing multi-year deals for Tempus’s patient data, and data and apps sales are growing faster than tests. Yet data remains the smaller business at a company that still runs an operating loss. Data and apps revenue growth is the figure to watch when Tempus reports again, expected in February 2027.
Now You Know Tempus AI. Here Is A Better Way To Invest
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