Tempus AI, Inc.

Thank you for standing by. My name is Jason and I will be your conference operator for today. At this time, I would like to welcome everyone to the fourth quarter 2024 financial results conference call. All lines have been placed on mute to prevent any background noise. After today's presentation, there will be an opportunity to ask questions. If you would like to ask a question during this time, simply press star followed by the number one on your keypad to join the queue. I will now turn the call over to Lizzy Cortolo. Please go ahead.

Thank you, Jason. Good afternoon and welcome to Tempest's fourth quarter 2024 conference call. This afternoon, Tempest released results for the quarter and year ended December 31st, 2024. Joining me today from Tempest are Eric Lipkowski, founder and CEO of Tempest, and Jim Rogers, CFO. Before we begin, I would like to remind you that during this call, management may make forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially. For discussion of these risks, please visit our 10-K file today, February 24th, 2025, as well as any future reports that we file with the FCC. During the call, we will discuss non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. Definitions of these non-GAAP financial measures, along with reconciliations to the most directly comparable GAAP financial measures, are included in our fourth quarter earnings release, which has been furnished to the SEC and is available on our website at investors.temphis.com. I would now like to turn the call over to Eric.

Thank you, and thanks, everyone, for joining the call. I'm just going to highlight a few quick bullets, and then we'll be happy to take questions. Q4 was a fantastic quarter for Tempest across the board. Our revenue growth accelerated to 35.8% year-over-year in the fourth quarter. Gross profit growth accelerated to 49.7%. So even though our revenues were growing rapidly, our gross profit was actually growing even more rapidly. We ended the year with $940 million in total remaining contract value and 140% net revenue retention. These were both up pretty materially. And one of the reasons that our gross profit growth was growing so quickly is our data and services business just had a really strong Q4, finishing a really strong year. And so that propelled some of that growth. It also is the reason we ended the year with an uptick in total remaining contract value and really record net revenue retention. We also closed the acquisition of Ambry Genetics on February 3rd, which is exciting as we've talked about that historically, but that's now behind us. So we'll have two months this quarter of Ambry's results in our numbers. And we also increased our revenue guidance. We had historically given at $1.23 billion, but we've upped that to $1.24 billion for 2025 and expect to be justity but not positive and generate about $5 million of justity but not. Obviously, you know, we're not providing a range. We give fairly specific numbers, but there's always an implied range. But we feel confident enough that we're increasing our guidance for 2025. Finally, I want to just note, if you read the letter Jim and I put out, you'll catch this in a section, but we did extend our Google agreement for another five years. It's kind of an awesome win for us in that it allows us to avail ourselves of really best-in-class rates, and it pushes out the note we have with Google another five years, and that note, as you'll recall, comes down as we spend on their platform, so it gives us more chance to work that to work that down. So, all-in, great quarter. You know, it's where we want to be. You want revenues accelerating in terms of growth. Our gross profit's growing quicker. Our costs are in line. So, we're generating the kind of leverage we want to see, and it's really just nice to be in a position where certainly our two main businesses, genomics and data, are really firing on all cylinders and in a period of strength.