TEM 10-K & 10-Q changes, risk factors and insider trading

Our AI Applications product line is nascent.

If we are unable to obtain or maintain adequate reimbursement for our GenomicsDiagnostics product line outside of the United States, our ability to expand internationally will be compromised.

We have incurred significant losses since our inception. For the years ended December 31, 2025, 2024 and 2023, we incurred net losses of $245.0 million, $705.8 million and $214.1 million, respectively. As of December 31, 2024,2025, we had an accumulated deficit of $2.2$2.4 billion. To date, we have financed our operations principally from the sale of stock and convertible securities, the incurrence of debt and revenue from our GenomicsDiagnostics and Data and applications businesses. We have devoted substantially all of our resources to the development and commercialization of our Platform and current products and to research and development activities related to Platform development and future products, including regulatory initiatives to obtain marketing approval or certification for our diagnostic tests, and sales and marketing activities for our GenomicsDiagnostics and Data and applications businesses. We will need to generate substantial revenue to achieve and then sustain profitability, and even if we achieve profitability, we cannot be sure that we will remain profitable for any period of time.

We believe our commercial success is dependent upon our ability to continue to successfully market and sell our current GenomicDiagnostics diagnosticsproducts, productsincluding both Oncology testing (legacy Tempus) and Hereditary testing (legacy Ambry Genetics), to continue to grow our Data and applications business by expanding our current relationships and developing new relationships with clinicians and pharmaceutical and biotechnology customers, and to develop and commercialize new products based on our Platform, including by expanding our GenomicsDiagnostics product line to new disease areas and by advancing our existingApplications andproduct future AI Applications.line. Our ability to achieve and maintain sufficient commercial market acceptance of our existing and future products will depend on a number of factors, including:

our ability to increase awareness of our GenomicsDiagnostics and AI Applicationsalgorithmic diagnostic tests and other AI Applications, including new product offerings as they become available;

the rate of adoption and/or endorsement of our GenomicsDiagnostics and AI Applicationsalgorithmic diagnostic tests and AI Applications by clinicians, pharmaceutical and biotechnology companies, KOLs, and advocacy groups;

the timing and scope of obtaining any necessary approvals or certification by regulatory authorities, including the FDA, for our diagnostic tests, any software offerings, AI Applications, or any features of our Platform, in each case, that may be subject to regulatory oversight;

our ability to increase demand for our Data and applications business, including by expanding our database of de- identified patient information and increasing the utility of our product offerings;

our ability to successfully expand beyondinto oncologynew intodisease areas, including neuropsychiatry, cardiology, radiology, digital pathology, and other indications;

Our quarterly and annual operating results may fluctuate significantly, which makes it difficult for us to predict our future operating results. Because we plan to operate our business with a long-term focus, these fluctuations may be more pronounced than those experienced by other companies that operate with a shorter- termshorter-term focus. These fluctuations may occur due to a variety of factors, many of which are outside of our control, including, but not limited to:

the volume and customer mix of our GenomicsDiagnostics, and AI Applicationsalgorithmic diagnostic testing, AI Applications,testing and other products;

the start and completion of projects in which our Data and Servicesapplications products are utilized;

the impact of natural disasters, political and economic instability, including wars (such as the armed conflictsconflict between Russia and Ukraine and the hostilities in the Middle East), terrorism, and political unrest, epidemics or pandemics, boycotts, curtailment of trade and other business restrictions; and general market conditions, including highfluctuations and risingin inflation rates, highand interest rates, government bank closures, liquidity concerns at other financial institutions, and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.competitors, which may impact not only our business, but the value of our marketable securities.

Additionally, it is difficult to predict the amounts, if any, we will be able to collect for our diagnostic tests from commercial payers. We are a participating network provider in a small number of commercial payers from whom we receive reimbursement for our diagnostic tests. Payers determine the amount they are willing to reimburse us for tests. We have provided testing to patients with many disease types and indications, most of the time as a non-participating provider. Even when payers have paid a claim, they may elect at any time to review previously paid claims for overpayment against these claims. While we have not experienced significant retroactive adjustments to date, in the event of an overpayment determination, the payer may offset the amount they determine they overpaid against amounts they owe us on current claims. We have limited leverage to dispute these retroactive adjustments and we cannot predict when, or how often, a payer might engage in these reviews. A significant amount of these offsets by one or more payers in any given quarter could have a material effect on our results of operations and cause them to fall below expectations or guidance we may provide. Due to the inherent variability and unpredictability of the reimbursement landscape, including related to the amount that payers reimburse us for any of our tests, previously recorded revenue adjustments are not indicative of future revenue adjustments from actual cash collections, which may fluctuate significantly.

In addition, the demand for our GenomicsDiagnostics and Data and Servicesapplications products will depend in part upon the research and development and clinical budgets of pharmaceutical and biotechnology customers, which are impacted by factors beyond our control, such as:

macroeconomic conditions (including any impact of unforeseen events such as the armed conflictsconflict between Russia and Ukraine and the hostilities in the Middle East), the political climate and the impact of public health emergencies such as the COVID-19 pandemic, hightariffs and risingtrade restrictions, inflation rates,rates highand, interest rates, government closures of banks and liquidity concerns at other financial institutions;

Uncertainty in the current political environment could also impact our business. In addition to potential changes in government programs and the research and development and clinical budgets of our potential customers, changes in government staffing or funding levels could affect various aspects of our business. For example, the reimbursement rates we receive from government payorspayers may experience downward pressures, and certain of our products that require government review or approval may experience delays in obtaining requisite authorizations. Conversely, the government may implement programs to accelerate the adoption of artificial intelligence within the healthcare industry, which could have a favorable impact on our operations. Given these uncertainties, it is impossible to predict how a shifting political environment may influence our operations.

Our operating results may fluctuate significantly due to reductions and delays in research and development or clinical expenditures by theseour customers. Further, many of our data licensing agreements allow us to deliver data to our customers over a period of time, which can span a year or longer. Revenue pursuant to our data licensing agreements is recognized upon delivery of the data to the customer, upon completion of performance obligations for related services, or ratably over time in the case of subscriptions. The actual timing of data deliveries can be based on a variety of factors, including, but not limited to, the customer’s requirements and/or our technological, operational, and human capital capacity; in addition, management assesses relevant contractual terms in contracts with customers and applies significant judgment in identifying and accounting for all terms and conditions in certain contracts.

This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period. If our revenue or operating results fall below the expectations of analysts or investors or below any guidance we may provide, or if the guidance we provide is below the expectations of analysts or investors, the price of our Class A common stock could decline substantially. Such a stock price decline could occur even when we have met any previously publicly stated guidance we may provide.

Our business relies on our ability to obtain, process, monetize and distribute highly regulated data in the healthcare industry, in a manner that complies with applicable laws, regulations and contractual and technological restrictions. The data that we collect through the provision of GenomicsDiagnostics tests and through other sources is critical to our ability to offer our Data and AI Applicationsthe products and services.services across both of our product lines. Our Platform also includes proprietary software and dedicated data pipelines that create a network of healthcare institutions that supply us with complex multimodal data. Further, we rely on certain collaborations and licensing agreements to access important data. The success of our business depends on our continued access to, and ability to monetize, this internal and external de-identified patient data. As we seek to expand our business into additional disease areas and geographies, we will also need to be successfulsuccessfully in buildingbuild and maintainingmaintain sufficiently large relevant data sets and obtainingobtain the permissions necessary to de-identify and use that data for commercial purposes.

Our ability to maintain, expand and monetize our datasets areis subject to a number of factors, many of which are outside of our control. With respect to data included in our Data and AI Applicationsapplications products, we rely on a combination of the statutory rights available to us as a HIPAA covered entity and as a HIPAAHealth Insurance Portability and Accountability Act, or HIPAA, business associate. As a HIPAA covered entity, we utilize data generated through our provision of GenomicDiagnostics tests. As a HIPAA business associate, we may rely on healthcare providers to obtain the requisite consents from their patients, with whom we may have no direct contact, to use the de-identified data that we generate in the provision of our other offerings to the providers, or that we generate from the protected health information, or PHI, we obtain from providers. More broadly, the failure by us or our data suppliers and processors to obtain patient data in a compliant manner could have a harmful effect on our ability to use and disclose data which in turn could impair our functions and operations, including our ability to share data with third parties or incorporate it into our products. In addition, the use, processing and distribution of patient data may require us or our data suppliers and processors to obtain consent from third parties or follow additional laws, regulations or contractual and technological restrictions that apply to the healthcare industry. These requirements could interfere with our ability to deploy our products, prevent creation of new products,products (including the development of foundation models, which depend on our ability to leverage de-identified data), or otherwise limit data-driven activities that benefit us. Moreover, due to lack of valid notice, sufficient consents or waiver, we may be subject to claims or liability for use or disclosure of data or other information.

We are also dependent on the healthcare institutions within our network continuing to provide us with broad access to data to multimodal data to support the robustness of our GenomicsDiagnostics tests and other offerings, as well as on establishing and maintaining our collaborations with ASCO,third ONCareparty Alliance and similar organizations, and entering into similar collaborationsorganizations with otheraccess organizationsto inlarge, themultimodal future,datasets, particularly as we attempt to expand into other disease areas. These third parties may have interests that diverge from our interests, including a desire to monetize their data in different ways, and there can be no assurance that we will be successful in maintaining and growing our datasets. Further, our arrangements with some of these third parties are not exclusive, which could allow such parties to provide data to our competitors, thereby adversely impacting our ability to offer differentiated products and services. Our practice of making available to providers the raw data from our GenomicsDiagnostics testingtesting, along with corresponding clinical data we may have structured as part of providing testing also may allow those providers to use data in ways that may be harmful to our business interests.

Continued adoption and use of our GenomicsDiagnostics product line will depend on several factors, including the prices we charge for our tests, the scope of coverage and amount of reimbursement available from third-party payers for our tests, the availability of clinical data that support the value of our tests and the inclusion of our tests in industry treatment guidelines. In addition, many clinicians, hospital systems and pharmaceutical companies have existing relationships with companies that develop molecular diagnostic tests, including our competitors, and may continue to use their tests instead of ours. Despite our business development efforts, it could be difficult, expensive and/or time-consuming for healthcare providers to switch diagnostic tests for their patients, and our tests may not be widely accepted by physicians,those providers, if at all, which could in turn hinder the growth of sales of our tests. If we are unable to achieve commercial success for our tests, our business, financial condition and results of operations would be materially and adversely affected. We are also particularly dependent on our clinical oncology and hereditary tests, which collectively accounted for 74%, 63% and 63% of our revenue in both the years ended December 31, 2025, 2024 and 2023.2023, respectively. We cannot assureensure that our oncology and hereditary tests will continue to maintain or gain market acceptance, and any failure to do so would materially harm our business, financial condition and results of operations.

Continued adoption of and use of our Data and Servicesapplications products will depend, in part, on our ability to maintain relationships and to enter into new relationships with pharmaceutical and biotechnology customers and provide relevant data to such customers for outcomes research, companion diagnostic development, novel target discovery and validation, among other uses. This can be difficult due to many factors, including the type of data required and our ability to deliver it to our pharmaceutical and biotechnology customers’ satisfaction. Our pharmaceutical and biotechnology customers may decide to decrease or discontinue their use of our Insights product due to changes in their research and product development plans, failures in their clinical trials, financial constraints, or other circumstances outside of our control. Furthermore, pharmaceutical and biotechnology companies may decline to do business with us or decrease or discontinue their use of our data due to a strategic collaboration with any of our competitors. We invest resources in seeking to develop relationships with pharmaceutical and biotechnology companies regarding potential commercial opportunities on an ongoing basis.basis, Therebut there can be no assurance that any of this investment will result in a commercial agreement, that the resulting relationship will be successful, or that the data we provide as part of the engagement will produce successful outcomes. If we cannot maintain our current relationships, or enter into new relationships, with pharmaceutical and biotechnology companies, our product development could be delayed and revenue and results of operations could be adversely affected.

The scope and robustness of the Data and Services and AI Applicationsapplications products that we can offer our customers also depend significantly on the continued success of our GenomicsDiagnostics product line, as the data that we collect through genomic testing is an essential component of our Data and Services and AI Applicationsapplications products. Further, we believe that growth in the use of our Data and Servicesapplications products will help drive awareness and adoption of our GenomicsDiagnostics product line, which in turn will drive further growth within our Data and Services and AI Applicationsapplications product lines.line. However, there can be no assurance that we will realize these synergies.

We were founded in 2015 and have experienced rapid growth in revenue, adoption of our products and services, testing volume, size of our datasets, clinical trial matches and other metrics that we believe are important to assessing our business. In addition, we operate in highly competitive markets characterized by rapid technological advances and our business has evolved, and we expect it to continue to evolve, over time to remain competitive. Our limited operating history, evolving business, rapid growth and ambitious goals make it difficult to evaluate our future prospects and the risks and challenges we may encounter, and may increase the risk that we will not continue to grow at or near historical rates. Further, these factors may make it difficult for us to achieve our stated milestones and goals, and to accurately project the future performance of our business. For example, we may never realize the potential benefits of our technology and research and development efforts as contemplated elsewhere in this Annual Report on Form 10-K.

costs related to our international expansion; and the potential costs ofof, and delays in product development as a result of any existing or new regulatory oversight applicable to our products.

We are party to a credit agreement with Ares Capital Corporation, under which we have no$206.0 committedmillion outstanding in term loans and $100.0 million outstanding in revolving credit facility as of December 31, 2025. We also have $750.0 million outstanding aggregate principal amount of 0.75% Convertible Senior Notes due 2030. In addition, we are party to a Controlled Equity OfferingSMSales Agreement, or the Sales Agreement, with Morgan Stanley & Co., LLC, Cantor Fitzgerald & Co., TD Securities (USA), LLC and Allen & Company LLC, as sales agents, or collectively, the Sales Agents, pursuant to which we may offer and sell from time to time, at our option, shares of Class A common stock through the Sales Agents, or the ATM, having an aggregate offering price of up to $500.0 million. In addition to the foregoing sources of capital.capital, Wewe may seek to sell equity securities, through the ATM or otherwise, or convertible securities, enter into aadditional credit facilityfacilities or another form of third-party funding, or seek other debt financing. The various ways we could raise additional capital carry potential risks. If we raise funds by issuing equity or convertible securities, dilution to our stockholders could result. Any preferred equity securities issued also could provide for rights, preferences or privileges senior to those of holders of our common stock. If we raise funds by issuing debt securities, those debt securities would have rights, preferences and privileges senior to those of holders of our common stock. The terms of debt securities issued or borrowings pursuant to a credit agreement could impose significant restrictions on our operations. If we raise funds through collaborations and licensing arrangements, we might be required to relinquish significant rights to our Platform or products or grant licenses on terms that are not favorable to us. These alternatives of raising additional capital may not be available to us on acceptable or commercially reasonable terms, if at all, or in amounts sufficient to meet our needs. The failure to obtain any required future financing may require us to reduce or eliminate certain existing operations and could contribute to negative market perceptions about us or our securities.

Our AI Applications product line is nascent.

We have limited commercialized algorithms within our AI Applications product line. Revenue generated from AI Applications is reported within our Data and Servicesapplications product line and was $20.2 million, $12.4 million and $5.5 million for the years ended December 31, 2025, 2024 and 2023, respectively, which represents 1.6%, 1.8% and 1.0% of our total revenue in each period. We have a number of additional Algosalgorithms in development and we may not be successful in developing and commercializing these or future Algos,algorithms, or in attaining our other development targets. Further, the scope and robustness of the AI Applications that we can offer our customers depend significantly on the continued success of our GenomicsDiagnostics product line and access to third-party data, of which there can be no assurance. We also cannot accurately estimate how our future AI Applications will be priced, whether reimbursement can be obtained or whether we will generate any revenue from such AI Applications. Further, the use of diagnostics that are entirely algorithmic in nature is novel andwhich (a) today represents only a small proportion of the diagnostics market.market The use of algorithmic diagnostics(b) may also be subject to existing and entirely new regulations that may substantially impact their adoption, use, reimbursement and ongoing viability.viability, and (c) involves nascent billing and reimbursement policies, which could limit their adoption, use, and reimbursement. While we believe AI Applications represent a significant long-term opportunity for us, there can be no assurances that a robust and sustained market for such diagnostics will develop or that we will successfully compete in any such market.

Before we can commercialize any new GenomicsDiagnostics or AI Applicationsalgorithmic diagnostic products, we will need to expend significant funds in order to:

Expanding the offerings of our Data and applications business is also a speculative and risky endeavor and may require us to:

correctly identify current and future customer needs and preferences and predict future needs and preferences;

As we develop our products, we have made and will have to continue to make significant investments in Platform development, marketing and selling resources, which could adversely affect our future cash flows. We may also rely on third parties to develop new products that we may license and include in our overall offering, particularly with respect to our AI Applications business, and we may exert limited or no control over such development efforts.

In addition, in our development and commercialization plans for our business lines,offerings, we may forego other opportunities that may provide greater revenue or be more profitable. For example, while we expect to continue to provide diagnostic and data technologies to pharmaceutical and biotechnology companies (including companies in which our Chief Executive Officer, Founder, and Chairman, Eric Lefkofsky, or our other executive officers, directors or significant stockholders may have significant or controlling voting and economic interests) developing therapeutics for various diseases, including cancers, we do not currently expect to conduct development of therapeutics ourselves. As a result, even if our development efforts result in commercially viable products, our business and results of operations could underperform in comparison to our customers and competitors.

We have developed multiple genomics diagnostics tests across oncology,oncology (including hereditary tests, infectious diseases, and neuropsychiatry, as well as algorithmic diagnostic tests across oncology and cardiology. A major part of our strategy is bringing new high-value enhancements to our customers through updates to our Platform and existing products, which may include expanding our existing products with additional features, applications and data modalities. We expect to make significant investments to advance these efforts.

Enhancing our Platform and products is a speculative and risky endeavor. Features, applications and data modalities that initially show promise may fail to achieve the desired results or may not achieve acceptable levels of analytical accuracy or utility. We may need to alter our products in development and repeat studies before we identify a potentially successful update. Product development is expensive, may take years to complete and can have uncertain outcomes. Failure can occur at any stage of the development. Even if we confirm that our products can be successfully updated for additional features, applications and data modalities, those features, applications and data modalities may be limited in scope to only some diseases, disease segments, patient markets or geographies. If, after development, an updated product appears successful, we may, depending on the nature of the update, need to obtain FDA’s, Notified Bodies’ and other regulatory bodies’ clearances, authorizations, certifications or approvals before we can market the updated product.

correctly identify current and future customer needs and preferences and predict future needs and preferences;

The life sciences scientific community is comprised ofcomprises a small number of early adopters and key opinion leaders who significantly influence the rest of the community. The success of life sciences products is due, in large part, to acceptance by the scientific community and their adoption of certain products as best practice in the applicable field of research. The current system of academic and scientific research views publishing in a peer- reviewed journal as a measure of success. In such journal publications, the researchers will describe not only their discoveries but also the methods and typically the products used to fuel such discoveries. Mentions in peer- reviewedpeer-reviewed journal publications isare a good barometer for the general acceptance of our products as best practices. Ensuring that early adopters and key opinion leaders publish research involving the use of our products is critical to ensuring our products gaingaining widespread acceptance and market growth. Continuing to establish and maintain good relationships with such key opinion leaders is vital to growing our market. The number of times our products were mentioned in peer-reviewed publications has increased significantly in recent years. As of December 31, 2024,2025, our products have been mentioned in 163over 800 peer-reviewed articles published in major journals, including 120 that were Tempus-authored.journals. We cannot assure investors, however, that our products will continue to be mentioned in peer-reviewed articles with any frequency or that any new products that we introduce in the future will be mentioned in peer-reviewed articles. In addition, self-authored journal publications that mention our products may present an actual, potential or perceived conflict of interest and, therefore, the number of publications in which our products are mentioned may not be indicative of the level of acceptance of our products. If too few researchers describe the use of our products, too many researchers shift to a competing product and publish research outlining their use of that product or too many researchers negatively describe the use or usability of our products in publications, it may drive existing and potential customers away from our products, which could harm our operating results. Any decrease in the frequency at which our products are mentioned in peer reviewed journals, or a decline in the quality of such publications, may negatively impact our prospects.

Our diagnostic products, or our competitors’ diagnostic products, could have defects or errors or otherwise fail to meet the expectations of patients, physicianshealthcare providers, and third-party payers; in such cases our operating results, reputation and business could suffer.

The success of our GenomicsDiagnostics and AIalgorithmic Applicationsdiagnostic products depends in part on patients’, physicians’healthcare providers, and third-party payers’ confidence that our Platform can provide reliable, high-quality intelligent diagnostics that will improve clinical outcomes and lower healthcare costs, as well as our ability to comply with applicable privacy and data security requirements. We believe that patients, physicians and third-party payers are likely to be particularly sensitive to our use of data, as well as product defects and errors in the use of our products, including if our products fail to detect genomic alterations or other clinical relevant information with high accuracy from samples, if we fail to list or inaccurately include certain treatment options and available clinical trials in our test reports, or if we fail to comply with applicable privacy and data security laws, and there can be no guarantee that we will be successful in this regard. Furthermore, if our competitors’ diagnostic products do not perform to expectations or if they fail to comply with applicable laws and regulations, it may result in lower confidence in us as well. As a result, the failure of our diagnostic products or our competitors’ diagnostic products to perform as expected, or failure by us or our competitors to comply with applicable laws and regulations, could significantly impair our operating results and our reputation. In addition, we may be subject to legal claims arising from any such failures, including claims that defects or errors in our diagnostic products led to injury or death. Confidence in us, as well as the strength of our brand and reputation, could also be eroded by perceived failures by us or our competitors, even absent any evidence of failure or wrongdoing.

If we are unable to support demand for our current and future GenomicsDiagnostics product line, including ensuring that we have adequate capacity to meet increased demand, or we are unable to successfully manage our anticipated growth, our business could suffer.

As the volume of our GenomicsDiagnostics product line sales grows, we will need to continue to increase our workflow capacity for sample intake, customer service, billing and general process improvements, expand our internal quality assurance program and extend our Platform to support comprehensive genomic analysis at a larger scale within expected turnaround times. We will need additional certified laboratory scientists and other scientific and technical personnel to process higher volumes of our GenomicsDiagnostics tests. Portions of our process are not automated and will require additional personnel to scale. We will also need to purchase additional equipment, some of which can take several months or more to procure, set up and validate, and increase our software and computing capacity to meet increased demand. There can be no assurance that any of these increases in scale, expansion of personnel, equipment, software and computing capacities or process enhancements will be successfully implemented, if at all, or that we will have adequate space in our laboratory facility or be able to secure additional facility space to accommodate such required expansion.

As we commercialize additional GenomicsDiagnostics products, we will need to incorporate new equipment, implement new technology systems and laboratory processes, and hire new personnel with different qualifications. Failure to manage this growth or transition could result in turnaround time delays, higher product costs, declining product quality, deteriorating customer service and slower responses to competitive challenges. A failure in any one of these areas could make it difficult for us to meet market expectations for our products and could damage our reputation and the prospects for our business.

Our ability to attract and retain candidatesindividuals to support the expansion of our GenomicsDiagnostics and other products may be influenced by factors outside our control, or factors that we can control but which we fail to execute. For example, global labor shortages, our compensation and benefits offerings, attempts at unionization by our employees, and other factors may impact our ability to recruit, hire, train, and retain employees, which will further impact our ability to meet our growth and expansion goals.

As of December 31, 2024,2025, we had received payment on approximately 55% of our clinical oncology next generation sequencing, or NGS, tests and 50% of our hereditary tests across all payers performed from January 1, 20222023 through December 31, 2023.2024. We calculated this metric on a trailing basis based on payer adjudication timing. However, we continued to perform our NGS tests through December 31, 2024. For the years ended December 31, 2025, 2024 and 2023, our average reimbursement for NGS tests in oncology (i.e., excluding hereditary testing) was approximately $1,600, $1,510 and $1,450, respectively. For the year ended December 31, 2025 and 2024, our average reimbursement for NGS tests in hereditary testing was approximately $770 and $760, on a pro forma basis, for which pro forma amounts have been calculated after applying the Company's accounting policies. In addition, we receive a substantial portion of our diagnostic revenue from a limited number of third-party commercial payers, most of which have not contracted with us to be a participating provider. We also receive reimbursement from Medicare for claims submitted with respect to our various diagnostic tests. Approximately 26% of our clinical oncology tests were for Medicare beneficiaries in both the years ended December 31, 2025, 2024 and 2023.2023, respectively. Approximately 10% of our hereditary tests were for Medicare beneficiaries in the year ended December 31, 2025. Our revenue and commercial success depend on achieving coverage and reimbursement for our tests from payers, including both commercial and government payers. If payers do not provide coverage of, or do not provide adequate reimbursement for our tests, we may need to seek payment from the patient, which may adversely affect demand for our tests.

In addition, because our GenomicsDiagnostics and AI Applicationsalgorithmic diagnostic tests represent new approaches to the diagnosis and detection of diseases,diseases or hereditary risk we cannot accurately estimate how they would be priced, whether reimbursement could be obtained or any potential revenue generated. Coverage determinations by a payer may depend on a number of factors, including but not limited to a payer’s determination that a test is appropriate, medically necessary or cost-effective. If we are unable to provide payers with sufficient evidence of the clinical utility and validity of our test, they may not provide coverage, may provide limited coverage or may terminate coverage, which will adversely affect our business, financial condition and results of operations. To the extent that more competitors enter our markets, the availability of coverage and the reimbursement rate for our tests may decrease as we encounter pricing pressure from our competitors or as payers decide based on other factors to lower the reimbursement rate for our tests.

Although we are a participating provider with several commercial payers, some large commercial payers have issued non-coverage policies that consider tissue and liquid comprehensive genomic profile testing, including certain of our GenomicsDiagnostics tests, as experimental or investigational. If we are not successful in obtaining coverage from such payers, or if other payers issue similar non-coverage policies, our business, financial condition and results of operations could be materially and adversely affected.

In the United States, many significant decisions about reimbursement for new diagnostics are made by the Centers for Medicare & Medicaid Services, or CMS, which makes a national coverage determination, or NCD, as to whether and to what extent a new diagnostic will be covered and reimbursed under Medicare, although it frequently delegates this authority to local Medicare Administrative Contractors, or MACs, which may make a local coverage determination, or LCD, with respect to coverage and reimbursement. Private payers tend to follow Medicare to a substantial degree. During the year ended December 31, 2024,2025, Medicare claims represented 26% of our clinical oncology testing volume and 10% of our hereditary testing volume. Given we operate laboratories in multiple MACs and run both LDTs and an FDA-approved assay, the applicable reimbursement determination varies based on the assay being run and the locations where it is being processed. The rules and standards that CMS uses to determine reimbursement rates for our tests are frequently changing and subject to revision, which could have a material impact on our results.

For example, Medicare’s NCD for NGS first established in 2018 and subsequently updated in 2020, states that NGS oncology tests (such as our Tempus|xT and Tempus|xF tests), would be covered by Medicare nationally if and when: (1) performed in a Clinical Laboratory Improvement Amendments, or CLIA, certified laboratory, (2) ordered by a treating physician, (3) the patient meets certain clinical and treatment criteria, including having recurrent, relapsed, refractory, metastatic, or advanced stages III or IV cancer, (4) the test is approved or cleared by the FDA as a companion in vitro diagnostic for an FDA approved or cleared indication for use in that patient’s cancer, and (5) results are provided to the treating physician for management of the patient using a report template to specify treatment options. We believe that our xT CDX assay, which received FDA approval in April 2023, will meetmeets the criteria for reimbursement under the NCD. In addition, effective July 1, 2024, our xT CDX assay was awarded Advanced Diagnostic Laboratory Test status by CMS. The NGS NCD also states that each MAC may provide local coverage of other next-generation sequencing tests for cancer patients only when the test is performed by a CLIA-certified laboratory, ordered by a treating physician and the patient meets the same clinical and treatment criteria required of nationally covered next-generation sequencing tests under the NGS NCD. An NGS test is typically not covered by Medicare when cancer patients do not have the above-noted indications for cancer under either an NCD or LCD.

National Government Services, Inc. is the local MAC that makes local coverage determinations, or LCDs, for tests conducted at our Chicago laboratory. TheNational LocalGovernment MACServices has issued two LCDs related to genetic testing in cancer, each of which currently requires claims to be submitted under a single current procedural terminology, or CPT, code that describes the test. BecauseSince noissuing CPTthe codeLCDs, comprehensivelyNational describesGovernment Services has, from time to time, issued modifications and interpretations of the LCDs and associated guidance documents that may impact how we bill for, and how National Government Services reimburses, our NGSdiagnostic oncology tests, we have historically submitted claims using individual codes based on the cancer subtype profiled. On March 25, 2021, the Local MAC instructed us to submit our claims using a different designated CPT code and indicated that such claims would be individually reviewed. Subsequently, on July 23, 2021, the Local MAC issued revised instructions for CPT coding and further updated those instructions on July 29, 2021.tests.

Palmetto is the MAC jurisdiction that determines reimbursement for tests conducted at our Raleigh and Atlanta laboratorieslaboratories. throughNoridian is the MAC jurisdiction that determines reimbursement for tests conducted at our Aliso Viejo laboratory. Both Palmetto and Noridian are subject to the MolDx program. MolDx requires laboratories to complete a technical assessment process in order to secure reimbursement for tests run at labs in its jurisdiction. Upon receiving approval in the technical assessment process, assays are assigned a z-code and a price at which MolDx will reimburse claims. In conjunction with launching our Raleigh laboratory, we submitted a technical assessment for our xT assay in 2022 and our xF assay in 2023. We received approval on our xT assay in October 2023 and on our xF assay in March 2024.

Other factors, beyond the NCD and applicable LCD’s, impact how we bill for our tests, whether they are reimbursed by third party-payors, and the amount we receive from government payors. For example, CMS has specific processes, such as the gapfill process, for determining the amount we are reimbursed for certain laboratory tests. In addition, pursuantcertain to theCMS regulations ofprevent CMS,us wefrom cannot billbilling Medicare directly for tests provided forto Medicare beneficiaries in somecertain situations.situations when the test is ordered as part of a beneficiary’s inpatient stay at a hospital. At the same time, CMS has adopted an exception to its laboratory date of service regulation,rules, and if certain conditions are met, molecular testing laboratories such as us can rely on that exception to bill Medicare directly, instead of seeking payment from the hospital. If this exception is repealed or curtailed by CMS, orif itsthe laboratory date of service regulation is otherwise changed to adversely impact our ability to bill Medicare directly, or if we incorrectly implement billing procedures related to the date of service exception, our revenue could be materially reduced.reduced, and we could be subject to further regulatory actions.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K.Some10-K. Some of the information contained in this discussion and analysis, including information with respect to our planned investments in our sales and marketing, research and development, and general and administrative functions, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Note Regarding Forward-Looking Statements” and “Risk Factors” in this Annual Report on Form 10-K for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. The following discussion provides a narrative of our financial condition and results of operations for the fiscal year ended December 31, 20242025 compared to the fiscal year ended December 31, 2023.2024. A discussion regarding our financial condition and results of operations for the fiscal year ended December 31, 20232024 compared to the fiscal year ended December 31, 20222023 can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our finalAnnual prospectus,Report datedon JuneForm 13,10-K 2024,for the year ended December 31, 2024 as filed with the U.S. Securities and Exchange Commission on JuneFebruary 17,24, 2024,2025, which is incorporated herein by reference.

We currently offer threetwo product lines: Genomics,Diagnostics and Data and AI Applications.applications. Each product line is designed to enable and enhance the others,other, thereby creating network effects in each of the markets in which we operate. We are able to commercialize records multiple times, both at the time a test is run and thereafter. Our GenomicsDiagnostics product line leverages our state-of-the-art laboratories to provide next generation sequencing, or NGS diagnostics, polymerase chain reaction, or PCR, profiling, molecular genotyping and other anatomic and molecular pathology testing to healthcare providers, pharmaceutical companies, biotechnology companies, researchers, and other third parties. The data generated in our lab or ingested into our platform as part of the GenomicsDiagnostics product line is structured and de-identified, prior to commercialization. This de-identified database is then commercialized to our pharmaceutical and biotechnology partners to facilitate drug discovery and development through twoour primaryproducts, Dataincluding, among other things, Insights, Trials, Next and Services products, Insights and Trials.Algos. Our thirdApplications product line, AI Applications,line is focused on developing and providing diagnostics that are algorithmic in nature, implementing new software as a medical device, and building and deploying clinical decision support tools.

We primarily operate in the United States and generated total revenue of $1,271.8 million, $693.4 million and $531.8 million in the years ended December 31, 2025, 2024 and 2023, respectively. We also incurred net losses of $245.0 million, $705.8 million and $214.1 million in the years ended December 31, 2025, 2024 and 2023, respectively. We generated adjusted EBITDA of $(7.4) million, $(104.7) million and $(154.2) million in the years ended December 31, 2025, 2024 and 2023, respectively. Adjusted EBITDA is a non-GAAP financial measure. For a reconciliation of adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with generally accepted accounting principles in the United States of America, or GAAP, and for additional information about adjusted EBITDA, a non-GAAP financial measure, see "—Non-GAAP Financial Measure."

On NovemberFebruary 4,3, 2024,2025, or the Closing Date, we enteredcompleted intoour acquisition, or the Ambry Acquisition, of Ambry Genetics Corporation, a Delaware corporation, or Ambry, pursuant to a Securities Purchase Agreement, or the Purchase Agreement, entered into on November 4, 2024 with REALM IDx, Inc., a Delaware corporation, or the Seller, and the Seller’s ultimate parent, Konica Minolta, Inc., a Japanese corporation, as guarantor,guarantor. pursuantWe to which we agreed to purchaseacquired all of the issued and outstanding shares of capital stock of AmbryAmbry. Genetics Corporation, a Delaware corporation, or Ambry, a leader in genetic testing that aims to improve health by understanding the relationship between genetics and disease. Such transaction is hereinafter referred to as the Acquisition. Pursuant to the terms of the Purchase Agreement, considerationConsideration for the Acquisitionacquisition consisted of $375.0 million in cash, subject to adjustment for cash, unpaid indebtedness, unpaid transaction expenses and net working capital of Ambry, or the Cash Consideration, plus the issuance of an aggregate of 4,843,136 shares, or the Shares,shares of our Class A common stock, or the Stock Consideration. We issued the Shares asThe Stock Consideration towas thevalued Sellerat on$61.54 Februaryper 3,share, 2025which uponwas the closing price of our Class A common stock on the Acquisition.Closing Date. Pursuant to the terms of the Purchase Agreement, 2,152,505 ofshares theissued Sharesas Stock Consideration are subject to a lock-up for a period of one year following the closingClosing date of the Acquisition.Date. In addition, $5.0 million of the Cash Consideration are held in an escrow account for purposes of satisfying any post-closing purchase price adjustments. The net working capital adjustment was finalized in September 2025, resulting in a decrease to the acquisition price of $3.0 million which was recorded to goodwill.

In connection with the closing of the Acquisition,acquisition, we entered into an amendment to the Credit Agreement (as defined below), providing for an additional $200.0 million in senior secured term loans, or the Additional Term Loan Facility, and $100.0 million in senior securedpriority revolving loan commitments, or the Revolving Credit Facility. We utilized borrowings under the Additional Term Loan Facility and the Revolving Credit Facility to fund the Cash Consideration for the Acquisitionacquisition and to pay fees and expenses related thereto.

In November 2021, we entered into a Master Services Agreement, or, as amended in October 2022, February 2023 and December 2023, the MSA,MSA with, and issued a warrant to, AstraZeneca AB, orwith AstraZeneca. Under the MSA, we agreed, on a non-exclusive basis, to provide AstraZeneca with certain of our products and services, including licensed data, sequencing, clinical trial matching, organoid modeling services, algorithm development, and others. In exchange for certain discounted prices, AstraZeneca has committed to spend a minimum of $220 million on such products and services during the term of the MSA. The term of the MSA will continue through December 31, 2028,2026, unless terminated sooner. The minimum commitment may increase from $220 million to $320 million through December 2028 ifat theAstraZeneca's average closing price of our Class A common stock exceeds two times the IPO price (as defined below) for any 30-day trading period following the one-year anniversary of our IPO.election.

We expect to maintain high levels of investment in product innovation over the coming years as we continue to develop new laboratory assays, develop algorithms, and expand our Platform into new disease areas. These investments will include laboratory costs incurred in validating new or improving current assays, licensing of data sets to accelerate our efforts in new diseases, and development and validation costs for new Algos products. We invested $172.9 million, $149.3 million and $90.3 million during the years ended December 31, 2025, 2024 and 2023,2023 respectively, in research and development. Our ability to develop new products, obtain regulatory approvals when required, launch them into the market, and drive adoption of these products by our customers will continue to play a key role in our results.

To grow our business requires both identifying new customers and expanding our partnerships with existing ones across each of our product lines. For Genomics,Diagnostics, this entails our field salesforce developing relationships with individual physiciansphysicians, genetic counselors and hospital systems, demonstrating the power our Platform has in enabling them to provide personalized care to their patients. For Data,Data and applications, this entails our pharmaceutical business development teams demonstrating the power our Platform and database have in enabling drug discovery, development and clinical trial matching for our pharmaceutical partners.partners For AI Applications, this entailsand demonstrating the utility of these algorithms in a clinical setting. Since our inception, our offerings have been used by more than 7,5008,500 physicians and we have worked with over 200250 biotech companies, as well as 19 of the 20 largest public pharmaceutical companies based on 20232024 revenue, albeit with many we are still at an early stage of adoption. Our financial performance relies heavily on our ability to add customers to our Platform and expand the relationships with our current customers through adoption of our new products.

Technology is at the core of everything we do. From receiving orders and ingesting data through our various provider integrations to delivering test results and access to our analytical platform, our Platform plays a key role in driving our business. We will continue to make significant investments in our Platform to continually improve our user experience and allow us to generate, ingest and structure data more efficiently as we expand our offerings. We invested $146.1 million, $167.5 million and $95.2 million during the years ended December 31, 2025, 2024 and 2023, respectively, in technology. We expect to maintain high levels of investment in our technology over the coming years as we continue to develop new features to support our current and future business needs. Our ability to execute on the development of such technology will continue to play a key factor in our results.

Our financial performance relies heavily on our ability to secure reimbursement from payers and government health benefits programs. A substantial majority of the genomic testing we perform is clinical in nature. We typically receive reimbursement for these tests from commercial payers and from government health benefits programs, such as Medicare and Medicaid. The amount of payment we receive varies widely and depends on a variety of factors, including the payer, the assay run, and other characteristics about the patient. As of December 31, 2024,2025, we had received payment on approximately 55% of our clinical oncology NGS tests and 50% of our hereditary tests across all payers performed from January 1, 20222023 through December 31, 2023.2024. We calculated this metric on a trailing basis based on payer adjudication timing. However, we continued to perform our NGS tests through December 31, 2024.2025. For the years ended December 31, 2025, 2024 and 2023, our average reimbursement for NGS tests in oncology (i.e., excluding hereditary testing) was approximately $1,600, $1,510 and $1,450, respectively. For the year ended December 31, 2025 and 2024, our average reimbursement for NGS tests in hereditary testing was approximately $770 and $760, on a pro forma basis, for which pro forma amounts have been calculated after applying our accounting policies. We will continue to invest significantly in various efforts aimed at improving our average reimbursement, including performing clinical studies to generate evidence of clinical utility, seeking regulatory approval for our tests, and opening additional lab locations. Any changes to medical policies impacting how our tests are reimbursed could have a significant impact on our results.

We currently primarily derive our revenue from our two product lines: (1) GenomicsDiagnostics and (2) Data and services.applications.

GenomicsDiagnostics primarily includes revenue from Oncology testing (legacy Tempus) and Hereditary testing (legacy Ambry Genetics). Oncology testing includes revenue from diagnostics, PCR profiling, and other anatomic and molecular pathology testing to healthcare providers,oncologists, pharmaceutical companies, biotechnology companies, researchers, and other third parties. Hereditary testing includes revenue from inherited cancer risk, whole exome and genome profiling for rare conditions, and all other inherited screening testing primarily to genetic counselors.

Data and servicesapplications primarily includes revenue from de-identified data generated through our GenomicsDiagnostics product line to our pharmaceutical and biotechnology partners for use in their drug development efforts. These transactions consist of data licensing agreements, AI-enabled clinical trial matching, and analytical services. Our Data revenue is typically back-weighted towards the second half of the year based on the budgeting cycles of our customers. We currently report our AI Applications revenue within this line item as it is immaterial.

We incur costs to generate revenue for each of our two primary product lines. Cost of revenues for our GenomicsDiagnostics product line is a higher percentage of the GenomicsDiagnostics revenue than cost of revenues for Data and servicesapplications is as a percentage of Data and servicesapplications revenue. As revenue shifts between these product lines, total cost of revenue as a percentage of revenue will be impacted.

Cost of Revenues, GenomicsDiagnostics

Cost of revenues for GenomicsDiagnostics primarily includes personnel lab expenses, including salaries, bonuses, employee benefits and stock-based compensation expenses (which we refer to as “personnel costs”), and amortization of intangible assets, cost of laboratory supplies and consumables, laboratory rent expense, depreciation of laboratory equipment and shipping costs. Costs associated with performing our tests are recorded as the tests are processed at the time of report delivery. We expect these costs will increase in absolute dollars as our GenomicsDiagnostics revenue continues to grow.

Cost of Revenues, Data and Servicesapplications

Cost of revenues for Data and servicesapplications primarily includes data acquisition and royalty fees, and personnel costs related to delivery of our data services and platform, cloud costs, and certain allocated overhead expenses. Costs associated with performing data product services are recorded as incurred. We expect these costs will increase in absolute dollars as our Data and servicesapplications revenue continues to grow. We currently report our AI Applications cost of revenue within this line item as it is immaterial.

We expect that our selling, general and administrative expenses will continue to increase in absolute dollars after our IPO, primarily due to increased headcount and costs associated with operating as a public company, including expenses related to legal, accounting, regulatory, maintaining compliance with exchange listing and requirements of the SEC, director and officer insurance premiums and investor relations. These expenses, though expected to increase in absolute dollars, are expected to decrease modestly as a percentage of revenue in the long term, though they may fluctuate as a percentage from period to period due to the timing and extent of these expenses. As the performance-based vesting condition of our RSUs was satisfied in connection with our IPO, we will continue to record stock-based compensation expenses associated with the vesting of RSUs in the quarter in which such vestings occur.

Interest expense consists primarily of interest from our Second Amended NoteNote, Credit Facilities, and Term Loan FacilityNotes (each as defined in “—Liquidity and Capital Resources”below), and finance leases.. Interest expense related to our convertibleSecond debtAmended Note will continue, but should decrease over time as the principal amount decreases.

Other income, net consists of foreign currency exchange gains and losses, gains and losses on marketable equity securities, income from the Intellectual Property Agreement, or the IP License Agreement, with SB Tempus Corp., or SB Tempus, and any changes in fair value related to our warrant assets and liabilities. Foreign currency exchange gains and losses relate to transactions and asset and liability balances denominated in currencies other than the U.S. dollar. We expect our foreign currency gains and losses to continue to fluctuate in the future due to changes in foreign currency exchange rates. We hold shares of common stock of Recursion and Personalis, Inc., or Personalis, which are recorded within marketable equity securities. These shares are marked to market each reporting period. We issued a warrant to our customer AstraZeneca in conjunction with the signing of the MSA in November 2021. The warrant was automatically cancelled and terminated for no consideration as AstraZeneca declined to extend its financial commitment before December 31, 2024. We have a warrant asset related to a November 2023 Commercialization and Reference Laboratory Agreement with Personalis, which was exercised in August 2024. The fair value of the warrant assets and liabilities are measured each reporting period.

ProvisionBenefit from (provision for) income taxes consists of U.S. federal and state income taxes and income taxes in certain foreign jurisdictions in which we conduct business, as adjusted for non-deductible expenses, and changes in the valuation of our deferred tax assets and liabilities. We maintain a full valuation allowance on our U.S. federal and state deferred tax assets as we have concluded that it is more likely than not that the deferred tax assets will not be realized.

Losses from equity method investments consist of earnings from our joint ventureventure, andSB equityTempus. methodSee investments.Note 6 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information regarding SB Tempus.

The increase in revenue for the year ended December 31, 2024,2025, compared to the same period in 2023,2024, was due to increased volume and reimbursement of clinical oncology and hereditary tests performed in GenomicsDiagnostics and increased data deliveries in our Data and Servicesapplications product line.

The increase in GenomicsDiagnostics revenue for the year ended December 31, 2024,2025, compared to the same period in 2023,2024, was primarily due to an increase in the number of oncologyOncology NGStests tests,and whichthe addition of Hereditary tests through the acquisition of Ambry. Volume of tests increased from approximately 218,700 tests for the year ended December 31, 2023 to approximately 270,800 tests for the year ended December 31, 2024.2024 Additionally, there was an increase in average revenue per NGS oncology test, which increased fromto approximately $1,450801,000 per testtests for the year ended December 31, 20232025, of which 460,500 tests related to approximatelyHereditary $1,510 per test for the year ended December 31, 2024. The increase in average revenue per test was driven primarily by increased Medicare reimbursement rates. The increase in the number of oncology NGS tests and average revenue per NGS oncology test resulted in a $91.8 million increase in Genomics revenue.testing.

The increase in Data and servicesapplications revenue for the year ended December 31, 2024,2025, compared to the same period in 2023,2024, was driven primarily by $52.9$70.9 million from increased demand for our Insights products. Across all Data and servicesapplications products, the increase in revenue in the year ended December 31, 20242025 is primarily attributable to continued growth from within our existing customer base, as well as adoption of our services by new customers that did not purchase services in the year ended December 31, 2023. Additionally, there was a $16.3 million increase in Insights products due to the reversal of warrant contract asset amortization related to the termination of the warrant with AstraZeneca.2024.

The increase in Cost of revenues for the year ended December 31, 2024,2025, compared to the same period in 2023,2024, was primarily due to an increaseincreases of $24.0$115.0 million in material and service costs, $22.1of which $69.2 million in material and services is due to the Ambry Acquisition, $41.4 million in personnel-related costs, of which $30.7 million is due to the Ambry Acquisition, $14.0 million in cloud costs, offset by a decrease of $12.8 million of stock-based compensation expenseexpenses related to RSUs for which the performance-based vesting condition was satisfied in connection with our IPO, $6.0 millionIPO in personnelthe costs,prior and $4.2 million in cloud expenses.period.

Cost of Revenues, GenomicsDiagnostics

The increase in Cost of revenues, GenomicsDiagnostics for the year ended December 31, 2024,2025, compared to the same period in 2023,2024, was primarily due to an increaseincreases of $24.0$115.0 million in material and service costs, $13.6of which $69.2 million in material and services is due to the Ambry Acquisition, $39.2 million in personnel-related costs, of which $30.7 million is due to the Ambry Acquisition, offset by a decrease of $7.4 million of stock-based compensation expense related to RSUs for which the performance-based vesting condition was satisfied in connection with our IPO, $7.6 millionIPO in personnelthe costs,prior $4.2 million in royalty licensing fees, and $1.9 million in cloud expenses.period.

Cost of Revenues, Data and Servicesapplications

Our business, financial condition and operating results are affected by a number of factors, whether currently known or unknown, including risks specific to us or the healthcare industry as well as risks that affect businesses in general. In addition to the information set forth in this Quarterly Report on Form 10-Q, you should consider carefully the factors discussed in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on February 24, 2026. The risks and uncertainties disclosed in such Annual Report could materially adversely affect our business, financial condition, cash flows or results of operations and thus our stock price. DuringExcept as set forth below, during the firstsecond quarter of fiscal 2026, there were no material changes to our previously disclosed risk factors.

We primarily operate in the United States and generated total revenue of $348.1$382.5 million and $255.7$314.6 million in the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $730.6 million and $570.4 million in the six months ended June 30, 2026 and 2025, respectively. We also incurred net income (losses) of $125.9$5.6 million and $68.0$(42.8) million in the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $(120.3) million and $(110.9) million in the six months ended June 30, 2026 and 2025, respectively. We generated adjusted EBITDA of $(2.8)$8.0 million and $(16.25.6) million in the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $5.2 million and $(21.8) million in the six months ended June 30, 2026 and 2025, respectively. Adjusted EBITDA is a non-GAAP financial measure. For a reconciliation of adjusted EBITDA to net loss,income (loss), the most directly comparable financial measure stated in accordance with generally accepted accounting principles in the United States of America, or GAAP, and for additional information about adjusted EBITDA, a non-GAAP financial measure, see "—Non-GAAP Financial Measure."

We also entered into an Order Form with Pathos under the previously disclosed Amended and Restated Master Agreement, restated effective February 12, 2024, (the Amended and Restated Master Agreement and the Order Form collectively referred to herein as the “Pathos Master Agreement”). Pursuant to the Pathos Master Agreement, (i) Pathos will be responsible for Foundation Model development activities under the MSA, (ii) we will license Pathos a comprehensive de-identified multi-modal dataset for the sole purpose of assisting in the development and training of the Foundation Model under the MSA, (iii) Pathos will pay us data license fees of $200 million over a three-year period, including an upfront payment of $50 million that has been paid as of April 2025 (iv) we will receive a license to use the Foundation Model upon its completion (with certain field restrictions and the right of sublicense to AstraZeneca), and (v) in consideration of Pathos’ commitments under the Pathos Master Agreement, we will pay Pathos $35 million, of which $25 million has been paid to date. Pathos, in its sole discretion, may pay up to 50% of the data license fees owed to us in shares of Pathos’ Series D Preferred Stock. In June 2026, Pathos paid $8.8 million of the data license fees in Pathos' Series D Preferred Stock, which is presented in Investment in related party on the condensed consolidated balance sheets and recorded under the measurement alternative for equity investments. As part of the transaction, we became a party to Pathos’ standard investment documents. The Pathos' Series D Preferred Stock is entitled to cumulative dividends at an annual rate of 5.0%. As of June 30, 2026, no dividends have been declared by the Pathos board of directors.

We expect to maintain high levels of investment in product innovation over the coming years as we continue to develop new laboratory assays, develop algorithms, and expand our Platform into new disease areas. These investments will include laboratory costs incurred in validating new or improving current assays, licensing of data sets to accelerate our efforts in new diseases, and development and validation costs for new Algos products. We invested $48.2$52.6 million and $35.9$41.6 million during the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $100.9 million and $77.5 million during the six months ended June 30, 2026 and 2025 respectively, in research and development. Our ability to develop new products, obtain regulatory approvals when required, launch them into the market, and drive adoption of these products by our customers will continue to play a key role in our results.

Technology is at the core of everything we do. From receiving orders and ingesting data through our various provider integrations to delivering test results and access to our analytical platform, our Platform plays a key role in driving our business. We will continue to make significant investments in our Platform to continually improve our user experience and allow us to generate, ingest and structure data more efficiently as we expand our offerings. We invested $45.9$43.9 million and $33.4$34.5 million,million induring the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $89.9 million and $67.9 million, in the six months ended June 30, 2026 and 2025, respectively, in technology. We expect to maintain high levels of investment in our technology over the coming years as we continue to develop new features to support our current and future business needs. Our ability to execute on the development of such technology will continue to play a key factor in our results. In addition, the announcement of substantial new tariffs and other restrictive trade policies, to the extent such current and future tariffs apply to hardware, networking infrastructure or other technology infrastructure used by us or our third-party vendors, could raise costs, constrain supply or affect service reliability.

Interest expense consists primarily of interest from our Second Amended Note, Credit Facilities, and Notes (each as defined in “—Liquidity and Capital Resources”). Interest expense related to our Second Amended Note will continue, but should decrease over time as the principal amount decreases. InterestSubsequent to May 2026, there will be no additional interest expense related to the Credit Facilities will continue, but decreased as a result of the prepayment of the TermCredit Loan FacilityFacilities in July 2025.2025 and May 2026.

Other Expense,Income, Net

Other expense,income, net consists of foreign currency exchange gains and losses, gains and losses on marketable equity securities, income from the Intellectual Property Agreement, or the IP License Agreement, with SB Tempus Corp., or SB Tempus. Foreign currency exchange gains and losses relate to transactions and asset and liability balances denominated in currencies other than the U.S. dollar. We expect our foreign currency gains and losses to continue to fluctuate in the future due to changes in foreign currency exchange rates. We hold shares of common stock of Recursion and Personalis, Inc., or Personalis, which are recorded within marketable equity securities. These shares are marked to market each reporting period.

(Provision for) Benefit from income taxes (Provision for) benefit from income taxes consists of U.S. federal and state income taxes and income taxes in certain foreign jurisdictions in which we conduct business, as adjusted for non-deductible expenses, and changes in the valuation of our deferred tax assets and liabilities. We maintain a full valuation allowance on our U.S. federal and state deferred tax assets as we have concluded that it is more likely than not that the deferred tax assets will not be realized.

Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025

The increase in revenue for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was due to increased volume of clinical oncology and hereditary tests performed in Diagnostics and increased data deliveries in our Data and applications product line. Beginning in 2026, xG (hereditary testing sold to oncologists) volumes and associated revenues are reported within Hereditary, which was applied to 2025 volumes and associated revenues. For comparative purposes, xG volumes were 10,500, 10,500 and 11,000 for three months ended June 30, 2025, September 30, 2025 and December 31, 2025, respectively.

The increase in Diagnostics revenue for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to an increase in the number of Oncology tests and the addition of Hereditary tests through the acquisition of Ambry in February 2025.tests. Volume of tests increased from approximately 153,000212,000 tests for the three months ended MarchJune 31,30, 2025 to approximately 218,000238,000 tests for the three months ended MarchJune 31,30, 2026, of which 132,500 tests related to Hereditary testing.2026.

Oncology tests increased from approximately 67,00073,500 tests for the three months ended MarchJune 31,30, 2025 to approximately 85,50096,500 tests for the three months ended MarchJune 31,30, 2026. Oncology revenue increased $34.0$37.5 million, primarily due to the increase in the volume of clinical oncology tests performed.

Hereditary tests increased from approximately 86,000138,500 tests for the three months ended MarchJune 31,30, 2025 to approximately 132,500141,500 tests for the three months ended MarchJune 31,30, 2026 due to the acquisition of Ambry in February 2025.2026. The increase is primarily due to the inclusionincrease in volume of Ambryhereditary fortests the full quarterperformed and an increase in ASP, which resulted in an increase of $33.3$5.4 million.

The increase in Data and applications revenue for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was driven primarily by an increase of $21.8 million and $3.0$20.5 million from increased demand for our Insights and Next products, respectively.products. Across all Data and applications products, the increase in revenue in the three months ended MarchJune 31,30, 2026 is primarily attributable to continued growth from within our existing customer base, specifically the Pathos Foundation Model agreement, as well as adoption of our services by new customers that did not purchase services in the three months ended MarchJune 31,30, 2025.

The increase in Cost of revenues for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to increases of $8.1 million in personnel-related costs, of which $4.5 million is due to the Ambry Acquisition that occurred in February 2025, $5.9 million in cloud costs, $5.7$3.9 million in material and service costs, of which $6.6$2.9 million isin duepersonnel-related costs, $2.9 million in costs related to thedevelopment Ambryof Acquisitionfoundation thatmodel, occurred in February 2025, $2.0$2.5 million of stock-based compensation expenses, and $1.1$1.4 million in royaltyclinical fees.studies costs.

The increase in Cost of revenues, Diagnostics for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to increases of $8.0 million in personnel-related costs, of which $4.5 million is due to the Ambry Acquisition that occurred in February 2025, $5.7$3.9 million in material and service costs, of which $6.6$3.1 million is due to the Ambry Acquisition that occurred in Februarypersonnel-related 2025,costs, and $1.1$2.2 million of stock-based compensation expense.

The increase in Cost of revenues, Data and applications for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to an increase of $5.9$4.0 million in cloud costs, $1.1$2.9 million in royaltycosts fees,related to development of foundation model, and $0.9$1.4 million in stock-basedclinical compensation.studies costs.

The increase in Technology research and development expenses for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to an increase of $6.2$5.3 million of stock-based compensation expenses and increase of $5.5$4.6 million in personnel-related costs associated with the investment in our cloud infrastructure and new lines of business, of which $2.6 million is due to the Ambry Acquisition that occurred in February 2025.business.

The increase in Research and development expenses for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to an increase of $6.6$3.4 million in validation and regulatory costs, $2.9 million of stock-based compensation expense, $1.7 million in personnel-related costs for employees in our research and development group, of which $4.3 million is due to the Ambry Acquisition that occurred in February 2025, $2.6$1.3 million of stock-basedoutside compensationservices expense,costs related to clinical studies, and $1.6$1.2 million of cloud costs, of which $0.9 million is due to the Ambry Acquisition that occurred in February 2025.costs.

The increase in Selling, general and administrative expenses for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was primarily due to an increase of $18.9$20.9 million of stock-based compensation expenses, $18.0$14.2 million in personnel-related costs, of which $10.3 million is due to the Ambry Acquisition that occurred in February 2025, $5.7 million in amortization of intangibles acquired from the Ambry Acquisition, $7.0$5.2 million in software and tools costs, of which $1.6 million is due to the Ambry Acquisition that occurred in February 2025, $5.2$4.9 million in cloud storage costs, $2.2 million due to the inclusion of other Ambry costs for the full quarter, and $2.1$4.5 million in legal costs. The increase is offset by a decrease inof $3.5$2.4 million of franchise tax, and $1.0 million in acquisition costs and $3.0 million in taxes related to the settlement of RSUs.costs.

The increase in Interest income for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, increased primarily due to higher cash on hand as of MarchJune 31,30, 2026 compared to MarchJune 31,30, 2025.

The decrease in Interest expense for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025,2025 is due to a decrease of $6.2$14.0 million as a result of the prepayment of the Term Loan Facility in July 2025, leaving only the Additional Term Loan Facility and Revolving Credit Facility outstandingin afterJuly the2025 prepayment.and May 2026. The decrease is offset by additional interest expense from the Notes, which resulted in an increase of $2.5$3.0 million.

Other Expense,Income, net

The change in Other expense,income, net for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was notprimarily material.driven by a $60.7 million increase in income related to unrealized gains on marketable equity securities.

BenefitProvision fromfor Income Taxes

The increase in losses from equity method investments for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, was due to the losses from SB Tempus.