Company: TEM
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000950170-25-025603
Chunk: 96

Company: Tempus AI, Inc.
Filing Date: 2025-02-24
Form: 10-K
Item: Item 1
Chunk 96
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 our own sales organization and may leverage distributors to help sell our Genomics diagnostic tests in international markets, and we sell our Data and Services products to pharmaceutical and biotechnology companies through our business development team. 

Each of our target markets is large, distinct and diverse. As a result, we believe it is necessary for many of our sales representatives and business development managers to have established diagnostic- or healthcare data- focused expertise. Competition for such employees within the precision diagnostics and healthcare data analytics industries is intense. We may not be able to attract and retain personnel or be able to build an efficient and effective sales organization or business development team, which could negatively impact sales and market acceptance of our products and limit our revenue growth and potential profitability. 

Our expected future growth will impose significant added responsibilities on members of management, including the need to identify, recruit, maintain and integrate additional employees. Our future financial performance and our ability to commercialize our products, to increase our sales and to compete effectively will depend, in part, on our ability to manage this potential future growth effectively, without compromising quality. 

If we are not successful in executing our strategy to increase sales of our Data and Services products to large pharmaceutical and biotechnology customers, our results of operations may suffer. 

An important part of our growth strategy is to increase sales of Data and Services products, and in particular our Insights product, to large pharmaceutical and biotechnology companies. Sales to large companies involve risks that may not be present (or that are present to a lesser extent) with sales to small-to-mid-sized entities. These risks include: 

•increased leverage held by large customers in negotiating contractual arrangements with us; 

•changes in key decision makers within these organizations that may negatively impact our ability to negotiate in the future; 

•customer employees may perceive that our products pose a threat to their internal control and advocate for internally developed solutions over our product; 

•resources may be spent on a potential customer that ultimately elects not to purchase our products; 

•more stringent requirements in our service contracts, including stricter service response times, and increased penalties for any failure to meet service requirements; 

•increased competition from larger competitors that traditionally target large enterprises and government entities; 

•less predictability in completing some of our sales than we do with smaller customers; and 

•the potential that advancements in AI allow our Data customers to develop models that serve as functional equivalents of our database and render our own products obsolete. 

Selling to large pharmaceutical and biotechnology companies is often a lengthy process,