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  "documentTitle": "Tempus AI, Inc. (TEM)",
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  "authorName": "Spruce Point Capital Management",
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  "presentationDate": "2025-05-28 00:00:00",
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      "text": "We believe that the FY25 revenue guidance increase earlier this month of $10 million is substantially explained by the expected contributions from the Ambry Genetics acquisition and the new Pathos/AstraZeneca deal, two factors that we estimate should have added nearly $46 million to projected revenue for the year.",
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      "text": "Adjusted EBITDA: $250M",
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      "text": "We believe the TCV that Tempus reports is aggressively defined with non-binding opt-ins, improbable milestone payments, related-party transactions, and self-funded commitments. For example, $300 million in cumulative opt-ins and $22.4 million in unlikely milestone payments are included in TCV, despite not representing firm contractual commitments. The April 2025 Pathos deal, which accounts for $200 million of TCV, involves a company founded, managed, and funded by Tempus leadership and Board-related investment firms, raising related-party and conflict-of-interest concerns. We also believe the Softbank JV allowed Tempus to recognize $95 million in TCV which is precisely the amount of capital Tempus contributed.",
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      "text": "We Estimate Total Contract Value (“TCV”) Is Inflated By ~$600M And See Questionable Revenue Quality",
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      "text": "We believe the accounting treatment of the $250 million Google Cloud debt raises significant concerns about the quality of its Adj. EBITDA and the Company's path to meeting its FY25 guidance. Specifically, Tempus nets the debt's principal reduction against cloud and software expenses in SG&A based on usage. This non-cash operating benefit, totaling $25.6 million over the last twelve months, directly inflates reported Adj. EBITDA. Without this adjustment, LTM Adj. EBITDA would have been ($102.6 million), rather than the reported ($77.0 million), and Adj. EBITDA margin would be -320 bps lower. We do not know the exact usage mechanism driving the debt principal reduction, but Tempus could be creating a cookie jar to achieve its inflection to $5 million of positive Adj. EBITDA for FY25. We believe the non-cash gain should be recorded as “other income” instead of an operating income benefit.",
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      "text": "We believe that the FY25 revenue guidance increase earlier this month of $10 million is substantially explained by the expected contributions from the Ambry Genetics acquisition and the new Pathos/AstraZeneca deal, two factors that we estimate should have added nearly $46 million to projected revenue for the year. With overall guidance rising by only a fraction of this amount, we believe it reveals a significant shortfall in the core genomics and data businesses. This discrepancy strongly suggests that the Company's fundamental operations are underperforming relative to prior expectations. It further supports the view that headline growth is being driven by acquisitions, related-party transactions, and financial maneuvers, rather than by robust organic growth in its main business lines. There are other indicators of a deterioration in business such as an exhaustion of nearly all long-term deferred revenue, a decline in the growth rate of cloud storage costs, and a recent amendment to the Google contract.",
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      "text": "Guidance Revision Reveals Weakness In Core Operations",
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      "kind": "paragraph",
      "text": "$250M Adjusted EBITDA Inflation Through A Novel Google Cloud Promissory Note Modification Structure",
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      "text": "Tempus Has 50% - 60% Downside Risk",
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