Tempus AI, a health-care diagnostics followers that uses AI to interpret medical tests to help physicians provide more accurate treatment for their patients, get up by as much as 15% in its Nasdaq Stock Market debut on Friday, after going public under the ticker shibboleth “TEM.”
Tempus AI priced 11.1 million shares at $37 apiece on Thursday, at the top of its initial $35 to $37 target distribute. The company raised $410 million at an implied valuation of just over $6 billion. Its early gains be involved the company to a valuation as high as $7 billion, but it closed its first day of trading up nearly 9%, for a market cap of roughly $6.65 billion.
Tempus believes that AI can workers guide therapy selection and treatment decisions, in conjunction with the patient’s doctor. It generated total revenue of $531.8 million in 2023 and a net squandering of $214.1 million.
“We’re on a really good trajectory,” Tempus AI CEO Eric Lefkofsky said on CNBC’s “Squawk Box” Friday morning earlier shares started trading. “As revenues have been growing quickly, we’re not investing all that gross profit dollar tumour back into the business. We’re generating improved leverage every quarter,” he said, adding that he expects the troop to be both cash flow and EBITDA positive within the next year.
Tempus AI is relating some of the most heavily-funded technology concepts — artificial intelligence and data analysis — to building a better, more well-versed medical profession. The lack of diagnostic testing early in the Covid-19 outbreak was an example of how a system as mature as our health-care infrastructure can that time be unprepared for the future.
The Chicago-based company said in its IPO filing, “we endeavor to unlock the true power of precision medicine by developing Intelligent Diagnostics through the practical application of artificial intelligence, or AI, in healthcare. Intelligent Diagnostics use AI, including generative AI, to invent laboratory tests more accurate, tailored, and personal. We make tests intelligent by connecting laboratory results to a sufferer’s own clinical data, thereby personalizing the results.”
The two-time CNBC Disruptor 50 company’s at-home testing kit was hurriedly rolled out during the pandemic, but the problem Tempus is attacking is not Covid-specific. The Tempus idea came to Lefkofsky, also have knowledge of for co-founding Groupon, during frustration with the health-care system after his wife received a breast cancer diagnosis. Oncology is a drill focus and the company’s genomic tests are designed to understand tumors at the molecular level and tailor treatment to individuals.
Morgan Stanley, J.P. Morgan and Allen & Gathering were the lead underwriters for Tempus AI’s offering.
Investors include Google, Baillie Gifford, Franklin Templeton, NEA and T. Rowe Payment, according to PitchBook data.
— CNBC’s Bob Pisani contributed to this reporting.
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