The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025 . 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 Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2025 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. Overview Tempus is a technology company focused on healthcare that straddles two converging worlds. We strive to combine deep healthcare expertise, providing next-generation diagnostics across multiple disease areas, with leading technology capabilities, harnessing the power of data and analytics to help personalize medicine. We endeavor to unlock the true power of precision medicine by creating Intelligent Diagnostics through the practical application of artificial intelligence, or AI, in healthcare. Intelligent Diagnostics use AI, including generative AI, to make laboratory tests more accurate, tailored, and personal. Unlike traditional diagnostic labs, we can incorporate unique patient information, such as clinical, molecular, and imaging data, with the goal of making our tests more intelligent and our results more insightful. Unlike other technology companies, we are deeply rooted in clinical care delivery as one of the largest sequencers of cancer patients, and patients with other diseases, in the United States. Straddling both worlds is advantageous as we believe Intelligent Diagnostics represent the future of precision medicine, informing more personalized and data-driven therapy selection and development. We believe their adoption could empower physicians to deliver better care and researchers to develop more precise therapies, with the potential to save millions of lives. In order to bring AI to healthcare at scale, we believe the foundation of how data flows throughout the ecosystem needs to be rebuilt. We established new data pipes, going to and from providers, to allow for the free exchange of data between physicians, who interpret data, and diagnostic and life science companies, who provide data, integrating relevant clinical data, such as outcomes, or adverse events, which are essential for many clinical decisions. Without this capability, we believe that data would continue to accumulate without impacting patient care. To accomplish this, we built both a technology platform to free healthcare data from silos and an operating system to make this data useful, the combination of which we refer to as our Platform. Our Platform connects multiple stakeholders within the larger healthcare ecosystem, often in real time, to assemble and integrate the data we collect, thereby providing an opportunity for physicians to make data-driven decisions in the clinic and for researchers to discover and develop therapeutics. We aim to help physicians find the best therapies for their patients, help pharmaceutical and biotechnology companies make the best drugs possible, and enable patients to access emerging therapies and clinical trials when appropriate. We currently offer two product lines: Diagnostics and Data and applications. Each product line is designed to enable and enhance the 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 Diagnostics product line leverages our 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 Diagnostics 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 our products, including, among other things, Insights, Trials, Next and Algos. Our Applications product 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 $382.5 million and $314.6 million in the three months ended June 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 $5.6 million and $(42.8) million in the three months ended June 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 $8.0 million and $(5.6) million in the three months ended June 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 income (loss), the most directly comparable financial measure 36 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." Acquisition of Personalis, Inc. On July 20, 2026, we announced that an Agreement and Plan of Merger, or the Merger Agreement, was entered into with Personalis. Under the terms of the agreement, we will acquire all outstanding shares of Personalis not already owned by us at a price of $16.25 per common share, representing a total enterprise value of $1.5 billion. The consideration is planned to consist entirely of the Company's common stock; however, the Company may elect to pay up to 50% of the aggregate consideration in cash. The closing is expected in late 2026 or early 2027, and is subject to Personalis’ shareholder approval, as well as receipt of applicable regulatory approvals and other customary closing conditions. The Merger Agreement was approved by both companies’ board of directors. Convertible Senior Notes 2032 On May 12, 2026, we completed a private offering, or the 2026 Offering, of $460.0 million aggregate principal amount of 0.00% Convertible Senior Notes due 2032, or the 2032 Notes, including the exercise in full of the initial purchasers’ over-allotment option to purchase up to an additional $60.0 million principal amount of the 2032 Notes. The 2032 Notes are our general unsecured obligations and will mature on May 15, 2032, unless earlier converted, redeemed or repurchased. Refer to Note 12 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information regarding the issuance and terms of the 2032 Notes and the 2032 Capped Call transaction (as defined in “—Liquidity and Capital Resources—Senior Convertible Notes”). Our net proceeds from the Offering were approximately $441.9 million, after deducting the initial purchasers’ discounts and commissions and the estimated offering expenses payable by us. We used a portion of the net proceeds from the Offering to repay $317.9 million of the Additional Term Loan Facility and Revolving Credit Facility (as defined in “—Liquidity and Capital Resources—Credit Facilities”), which includes repayment of the principal, accrued interest, and prepayment premium and to pay approximately $31.2 million cost of the 2032 Capped Call. We expect to use the remaining net proceeds from the 2026 Offering for general corporate purposes, which may include acquisitions or strategic investments in complementary businesses or technologies, working capital, operating expenses, capital expenditures and repayment of additional indebtedness. Strategic Collaborations AstraZeneca and Pathos In April 2025, we entered into a series of agreements with AstraZeneca AB, or AstraZeneca, and Pathos regarding both the development of a foundation large multimodal model in the field of oncology, or the Foundation Model, and the licensing of certain de-identified multi-modal data to assist in the development of the Foundation Model. Specifically, we entered into a Statement of Work with AstraZeneca under the previously disclosed Master Services Agreement, dated November 17, 2021, as amended in October 2022, February 2023 and December 2023 (and as further amended from time to time, together with the Statement of Work, collectively referred to herein as the MSA). Pursuant to the MSA, (i) we will ensure that Pathos develops, and we provide AstraZeneca with, a Foundation Model which has been developed, validated, and maintained using de-identified datasets contributed by us, (ii) the Foundation Model will be developed, validated, and maintained by Pathos, (iii) AstraZeneca will pay us a fee of $35 million, and (iv) a syndicate of investors including AstraZeneca will contemporaneously execute a Stock Purchase Agreement with Pathos, or the SPA, as part of a preferred stock financing round of sufficient size given the obligations described herein. 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 37 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. AstraZeneca As previously disclosed, in November 2021, we entered into the MSA with 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, 2026, unless terminated sooner. The minimum commitment may increase from $220 million to $320 million through December 2028 at AstraZeneca's election. GlaxoSmithKline In August 2022, we entered into a Strategic Collaboration Agreement, or, as amended in May 2024, the GSK Agreement, with GlaxoSmithKline, or GSK. Under the GSK Agreement, we agreed, on a non-exclusive basis, to provide GSK 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, GSK has committed to spend a minimum of $180 million on such products and services during the term of the GSK Agreement, of which $70 million was paid upon execution. The term of the GSK Agreement will continue through December 31, 2027, unless terminated sooner. An additional commitment of up to $120 million may be triggered at GSK’s election for the years 2028, 2029 and 2030. Recursion Master Agreement In November 2023, we entered into a Master Agreement, or the Recursion Agreement, with Recursion Pharmaceuticals, Inc., or Recursion. Under the Recursion Agreement, we agreed to provide certain of our services and to license certain data to Recursion, including a limited right to access our proprietary database of de-identified clinical and molecular data for certain therapeutic product development purposes. In exchange for these rights, Recursion will pay an initial license fee of $22 million and an annual license fee throughout the term of the agreement, which, together with the initial license fee, totals up to $160 million. The term of the Recursion Agreement will continue through November 3, 2028, unless terminated sooner. In addition to mutual rights to terminate for an uncured breach of the Recursion Agreement, Recursion may terminate the agreement for convenience after three years upon 90 days prior notice, subject to payment by Recursion of an early termination fee. The initial license fee and each annual license fee are payable at Recursion’s option either in the form of (x) cash, (y) shares of Recursion’s Class A common stock, or (z) a combination of cash and shares of Recursion’s Class A common stock in such proportion as is determined by Recursion in its sole discretion; provided that the aggregate number of shares of Recursion’s Class A common stock to be issued to us under the Recursion Agreement shall not exceed 19.9% of the aggregate total of shares of Recursion Class A common stock and Class B common stock outstanding on November 3, 2023, or the date immediately preceding the date any shares of Class A common stock are issued pursuant to the Recursion Agreement, whichever is less. We have customary registration rights with respect to any shares of Recursion’s Class A common stock issued pursuant to the Recursion Agreement. Factors Affecting Our Performance We believe there are several important factors that have impacted and that we expect will impact our operating performance and results of operations. While each of these areas presents significant opportunities for us, they also pose significant risks and challenges that we must address. Research and Development and New Products 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 $52.6 million and $41.6 million during the three months ended June 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. 38 Customer Acquisition and Expansion To grow our business requires both identifying new customers and expanding our partnerships with existing ones across each of our product lines. For Diagnostics, this entails our field salesforce developing relationships with individual physicians, genetic counselors, and hospital systems, demonstrating the power our Platform has in enabling them to provide personalized care to their patients. For 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 and demonstrating the utility of these algorithms in a clinical setting. Since our inception, our offerings have been used by more than 9,000 physicians and we have worked with over 250 biotech companies, as well as 19 of the 20 largest public pharmaceutical companies based on 2025 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. Investments in Technology 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 $43.9 million and $34.5 million during the three months ended June 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. Payer Coverage and Reimbursement 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, 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, 2023 through December 31, 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, 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. Macroeconomic Conditions A significant portion of our current Data and applications products sales are to customers in the life sciences industry, in particular the pharmaceutical and biotechnology industry. Demand for our Data and applications products could be affected by factors that adversely affect the life sciences industry, including macroeconomic and market conditions that may adversely impact earlier stage biotechnology companies such as substantial new tariffs and other restrictive trade policies. Components of Results of Operations Revenue We currently primarily derive our revenue from our two product lines: (1) Diagnostics and (2) Data and applications. Diagnostics Diagnostics 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 oncologists, pharmaceutical companies, biotechnology companies, researchers, and other third parties. Hereditary testing includes 39 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 applications Data and applications primarily includes revenue from de-identified data generated through our Diagnostics 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. Cost and Operating Expenses We incur costs to generate revenue for each of our two product lines. Cost of revenues for our Diagnostics product line is a higher percentage of the Diagnostics revenue than cost of revenues for Data and applications is as a percentage of Data and applications revenue. As revenue shifts between these product lines, total cost of revenue as a percentage of revenue will be impacted. Cost of Revenues, Diagnostics Cost of revenues for Diagnostics 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 Diagnostics revenue continues to grow. Cost of Revenues, Data and applications Cost of revenues for Data and applications 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 applications revenue continues to grow. Research and Development Research and development expense primarily includes costs incurred to develop new assays and products, including validation costs, research and development and allocated lab personnel costs, salaries and benefits of our scientific and laboratory research and development teams, amortization of intangible assets, inventory costs, overhead costs, contract services and other related costs. Research and development costs are expensed as incurred. We plan to continue to invest in new assay development and expansion into new disease areas. As a result, we expect that research and development expenses will increase in absolute dollars for the foreseeable future as we continue to invest to support these activities. Technology Research and Development Technology research and development expense primarily includes personnel costs incurred related to the research and development of our technology platform and applications and the research and development of new products that we hope to bring to the market. Technology research and development costs are expensed as incurred. We plan to continue to invest in technology personnel to support our Platform and new algorithm development. We expect that technology research and development expenses will increase in absolute dollars for the foreseeable future as we continue to invest to support these activities. Selling, General and Administrative Our selling, general and administrative expense primarily includes personnel costs, inclusive of stock-based compensation expense, for our sales, executive, accounting and finance, legal and human resources functions, commissions, and other general corporate expenses, including software and tools, professional services, real estate costs, and travel costs. Interest Income Interest income consists of interest earned on our cash and cash equivalents. 40 Interest Expense 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. Subsequent to May 2026, there will be no additional interest expense related to the Credit Facilities as a result of the prepayment of the Credit Facilities in July 2025 and May 2026. Loss on Debt Extinguishment Loss on debt extinguishment consists of the recognition of unamortized original issuance discount, unamortized deferred financing fees, and prepayment premium as a result of the prepayment of the Additional Term Loan Facility and Revolving Credit Facility (defined in “—Liquidity and Capital Resources”). Other Income, Net 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. 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, 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. Losses from Equity Method Investments Losses from equity method investments consist of earnings from our joint venture, SB Tempus. See Note 7 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional information regarding SB Tempus. 41 Results of Operations The following table sets forth the significant components of our results of operations for the periods presented (in thousands). Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net revenue Diagnostics $ 289,333 $ 241,843 $ 550,431 $ 435,647 Data and applications 93,153 72,792 180,171 134,725 Total net revenue $ 382,486 $ 314,635 $ 730,602 $ 570,372 Cost and operating expenses Cost of revenues, diagnostics 108,233 99,756 209,193 184,539 Cost of revenues, data and applications 27,755 19,840 52,870 35,591 Technology research and development 43,929 34,482 89,850 67,873 Research and development 52,637 41,619 100,874 77,493 Selling, general and administrative 225,845 180,712 438,439 335,339 Total cost and operating expenses 458,399 376,409 891,226 700,835 Loss from operations $ (75,913 ) $ (61,774 ) $ (160,624 ) $ (130,463 ) Interest income 3,897 1,093 7,763 2,906 Interest expense (10,283 ) (21,579 ) (24,624 ) (39,582 ) Loss on debt extinguishment (11,643 ) — (11,643 ) — Other income, net 102,757 41,729 75,048 14,274 Income (loss) before (provision for) benefit from income taxes 8,815 (40,531 ) (114,080 ) (152,865 ) (Provision for) benefit from income taxes (309 ) (212 ) (247 ) 45,968 Losses from equity method investments (2,864 ) (2,100 ) (5,950 ) (3,983 ) Net income (loss) $ 5,642 $ (42,843 ) $ (120,277 ) $ (110,880 ) Comparison of the Three Months Ended June 30, 2026 and 2025 Revenue Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Diagnostics $ 289,333 $ 241,843 $ 47,490 20 % Data and applications 93,153 72,792 20,361 28 % Total Net Revenue $ 382,486 $ 314,635 $ 67,851 22 % The increase in revenue for the three months ended June 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. Diagnostics The increase in Diagnostics revenue for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase in the number of Oncology tests and Hereditary tests. Volume of tests increased from approximately 212,000 tests for the three months ended June 30, 2025 to approximately 238,000 tests for the three months ended June 30, 2026. Oncology tests increased from approximately 73,500 tests for the three months ended June 30, 2025 to approximately 96,500 tests for the three months ended June 30, 2026. Oncology revenue increased $37.5 million, primarily due to the increase in the volume of clinical oncology tests performed. Hereditary tests increased from approximately 138,500 tests for the three months ended June 30, 2025 to approximately 141,500 tests for the three months ended June 30, 2026. The increase is primarily due to the increase in volume of hereditary tests performed and an increase in ASP, which resulted in an increase of $5.4 million. 42 The remaining increase of $4.5 million is due to growth in our other product lines within Diagnostics. Data and applications The increase in Data and applications revenue for the three months ended June 30, 2026, compared to the same period in 2025, was driven primarily by an increase of $20.5 million from increased demand for our Insights products. Across all Data and applications products, the increase in revenue in the three months ended June 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 June 30, 2025. Cost and Operating Expenses Cost of Revenues Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Cost of revenues, diagnostics $ 108,233 $ 99,756 $ 8,477 8 % Cost of revenues, data and applications 27,755 19,840 7,915 40 % Total $ 135,988 $ 119,596 $ 16,392 14 % The increase in Cost of revenues for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to increases of $4.5 million in cloud costs, $3.9 million in material and service costs, $2.9 million in personnel-related costs, $2.9 million in costs related to development of foundation model, $2.5 million of stock-based compensation expenses, and $1.4 million in clinical studies costs. Cost of Revenues, Diagnostics The increase in Cost of revenues, Diagnostics for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to increases of $3.9 million in material and service costs, $3.1 million in personnel-related costs, and $2.2 million of stock-based compensation expense. Cost of Revenues, Data and applications The increase in Cost of revenues, Data and applications for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $4.0 million in cloud costs, $2.9 million in costs related to development of foundation model, and $1.4 million in clinical studies costs. Technology Research and Development Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Technology research and development $ 43,929 $ 34,482 $ 9,447 27 % The increase in Technology research and development expenses for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $5.3 million of stock-based compensation expenses and increase of $4.6 million in personnel-related costs associated with the investment in our cloud infrastructure and new lines of business. Research and Development Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Research and development $ 52,637 $ 41,619 $ 11,018 26 % 43 The increase in Research and development expenses for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $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, $1.3 million of outside services costs related to clinical studies, and $1.2 million of cloud costs. Selling, General and Administrative Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Selling, general and administrative $ 225,845 $ 180,712 $ 45,133 25 % The increase in Selling, general and administrative expenses for the three months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $20.9 million of stock-based compensation expenses, $14.2 million in personnel-related costs, $5.2 million in software and tools costs, $4.9 million in cloud storage costs, and $4.5 million in legal costs. The increase is offset by a decrease of $2.4 million of franchise tax, and $1.0 million in acquisition costs. Interest Income Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Interest income $ 3,897 $ 1,093 $ 2,804 257 % The increase in Interest income for the three months ended June 30, 2026, compared to the same period in 2025, increased primarily due to higher cash on hand as of June 30, 2026 compared to June 30, 2025. Interest Expense Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Interest expense $ (10,283 ) $ (21,579 ) $ 11,296 -52 % The decrease in Interest expense for the three months ended June 30, 2026, compared to the same period in 2025 is due to a decrease of $14.0 million as a result of the prepayment of the Additional Term Loan Facility and Revolving Credit Facility in July 2025 and May 2026. The decrease is offset by additional interest expense from the Notes, which resulted in an increase of $3.0 million. Loss on Debt Extinguishment Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Loss on debt extinguishment $ (11,643 ) $ — $ (11,643 ) 100 % The change in Loss on debt extinguishment for the three months ended June 30, 2026, compared to the same period in 2025, was driven by the repayment of the Additional Term Loan Facility and Revolving Credit Facility in May 2026, which includes repayment of the principal, accrued interest, and prepayment premium. The repayment resulted in a loss on debt extinguishment of $11.6 million. 44 Other Income, net Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Other income, net $ 102,757 $ 41,729 $ 61,028 146 % The change in Other income, net for the three months ended June 30, 2026, compared to the same period in 2025, was primarily driven by a $60.7 million increase in income related to unrealized gains on marketable equity securities. Provision for Income Taxes Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Provision for income taxes $ (309 ) $ (212 ) $ (97 ) 46 % The change in provision for income tax expense for the three months ended June 30, 2026, compared to the same period in 2025, was not material. Losses from Equity Method Investments Three Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Losses from equity method investments $ (2,864 ) $ (2,100 ) $ (764 ) 36 % The increase in losses from equity method investments for the three months ended June 30, 2026, compared to the same period in 2025, was due to the losses from SB Tempus. Comparison of the Six Months Ended June 30, 2026 and 2025 Revenue Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Diagnostics $ 550,431 $ 435,647 $ 114,784 26 % Data and applications 180,171 134,725 45,446 34 % Total Net Revenue $ 730,602 $ 570,372 $ 160,230 28 % The increase in revenue for the six months ended June 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. Diagnostics The increase in Diagnostics revenue for the six months ended June 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. Volume of tests increased from approximately 365,000 tests for the six months ended June 30, 2025 to approximately 456,000 tests for the six months ended June 30, 2026, of which 274,000 tests related to Hereditary testing. 45 Oncology tests increased from approximately 140,500 tests for the six months ended June 30, 2025 to approximately 182,000 tests for the six months ended June 30, 2026. Oncology revenue increased $69.0 million, primarily due to the increase in the volume of clinical oncology tests performed. Hereditary tests increased from approximately 224,500 tests for the six months ended June 30, 2025 to approximately 274,000 tests for the six months ended June 30, 2026 due to the acquisition of Ambry in February 2025. The increase is primarily due to the inclusion of Ambry for the full period and resulted in an increase of $38.7 million. The remaining increase of $7.1 million is due to growth in our other product lines within Diagnostics. Data and applications The increase in Data and applications revenue for the six months ended June 30, 2026, compared to the same period in 2025, was driven primarily by an increase of $42.3 million and $3.6 million from increased demand for our Insights and Next products, respectively. Across all Data and applications products, the increase in revenue in the six months ended June 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 six months ended June 30, 2025. Cost and Operating Expenses Cost of Revenues Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Cost of revenues, diagnostics $ 209,193 $ 184,539 $ 24,654 13 % Cost of revenues, data and applications 52,870 35,591 17,279 49 % Total $ 262,063 $ 220,130 $ 41,933 19 % The increase in Cost of revenues for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to increases of $11.1 million in personnel-related costs, of which $5.5 million is due to the Ambry Acquisition that occurred in February 2025, $10.9 million in cloud costs, $10.0 million in material and service costs, of which $3.1 million is due to the Ambry Acquisition that occurred in February 2025, $4.5 million of stock-based compensation expenses, $2.9 million in costs related to development of foundation model, $2.8 million in clinical studies costs. Cost of Revenues, Diagnostics The increase in Cost of revenues, Diagnostics for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to increases of $11.2 million in personnel-related costs, of which $5.5 million is due to the Ambry Acquisition that occurred in February 2025, $10.0 million in material and service costs, of which $3.1 million is due to the Ambry Acquisition that occurred in February 2025, and $3.3 million of stock-based compensation expense. Cost of Revenues, Data and applications The increase in Cost of revenues, Data and applications for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $9.9 million in cloud costs, $2.9 million in costs related to development of foundation model, $2.8 million in clinical studies costs, and $1.2 million in stock-based compensation. Technology Research and Development Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Technology research and development $ 89,850 $ 67,873 $ 21,977 32 % The increase in Technology research and development expenses for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $11.5 million of stock-based compensation expenses and increase of $10.1 million 46 in personnel-related costs associated with the investment in our cloud infrastructure and new lines of business, of which $2.9 million is due to the Ambry Acquisition that occurred in February 2025. Research and Development Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Research and development $ 100,874 $ 77,493 $ 23,381 30 % The increase in Research and development expenses for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $8.3 million in personnel-related costs for employees in our research and development group, of which $4.1 million is due to the Ambry Acquisition that occurred in February 2025, $5.5 million of stock-based compensation expense, $4.1 million of validation and regulatory costs, $2.8 million of cloud costs, of which $0.8 million is due to the Ambry Acquisition that occurred in February 2025, and $1.5 million of outside services costs related to clinical studies. Selling, General and Administrative Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Selling, general and administrative $ 438,439 $ 335,339 $ 103,100 31 % The increase in Selling, general and administrative expenses for the six months ended June 30, 2026, compared to the same period in 2025, was primarily due to an increase of $39.8 million of stock-based compensation expenses, $32.2 million in personnel-related costs, of which $15.6 million is due to the Ambry Acquisition that occurred in February 2025, $12.2 million in software and tools costs, of which $1.4 million is due to the Ambry Acquisition that occurred in February 2025, $10.1 million in cloud storage costs, $6.6 million in legal costs, and $5.5 million in amortization of intangibles acquired from the Ambry Acquisition. The increase is offset by a decrease in $4.5 million in acquisition costs and $3.0 million in taxes related to the settlement of RSUs. Interest Income Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Interest income $ 7,763 $ 2,906 $ 4,857 167 % The increase in Interest income for the six months ended June 30, 2026, compared to the same period in 2025, increased primarily due to higher cash on hand as of June 30, 2026 compared to June 30, 2025. Interest Expense Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Interest expense $ (24,624 ) $ (39,582 ) $ 14,958 -38 % 47 The decrease in Interest expense for the six months ended June 30, 2026, compared to the same period in 2025, is due to a decrease of $20.2 million as a result of the prepayment of the Term Loan Facility in July 2025 and of the Additional Term Loan Facility and Revolving Credit Facility in May 2026. The decrease is offset by additional interest expense from the Notes, which resulted in an increase of $5.6 million. Loss on Debt Extinguishment Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Loss on debt extinguishment $ (11,643 ) $ — $ (11,643 ) 100 % The change in Loss on debt extinguishments for the six months ended June 30, 2026, compared to the same period in 2025, was driven by the repayment of the Additional Term Loan Facility and Revolving Credit Facility, which includes repayment of the principal, accrued interest, and prepayment premium. The repayment resulted in a loss on debt extinguishment of $11.6 million. Other Income, net Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Other income, net $ 75,048 $ 14,274 $ 60,774 426 % The change in Other income, net for the six months ended June 30, 2026, compared to the same period in 2025, was primarily driven by a $60.2 million increase in income related to realized and unrealized gains on marketable equity securities. (Provision for) Benefit from Income Taxes Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) (Provision for) benefit from income taxes $ (247 ) $ 45,968 $ (46,215 ) -101 % The change in provision for income tax (expense) benefit for the six months ended June 30, 2026, compared to the same period in 2025, was due to a $46.2 million discrete tax benefit recorded in the prior period from the release of a portion of the valuation allowance attributable to net deferred tax liabilities related to the acquisition of Ambry which offset certain of our net deferred tax assets. Losses from Equity Method Investments Six Months Ended June 30, 2026 2025 $ Change % Change (unaudited) (in thousands, except percentages) Losses from equity method investments $ (5,950 ) $ (3,983 ) $ (1,967 ) 49 % The increase in losses from equity method investments for the six months ended June 30, 2026, compared to the same period in 2025, was due to the losses from SB Tempus. 48 Non-GAAP Financial Measure To supplement our condensed consolidated financial statements prepared and presented in accordance with accounting principles generally accepted in the United States of America, or GAAP, we use adjusted EBITDA to facilitate analysis of our financial and business trends and for internal planning and forecasting purposes. EBITDA is defined as earnings before interest, taxes, depreciation and amortization. We define adjusted EBITDA as net income (loss), adjusted to exclude (i) interest income, (ii) interest expense, (iii) depreciation and amortization, (iv) provision for (benefit from) income taxes, (v) losses from equity method investments, (vi) changes in fair value of our marketable equity securities and indemnity-related holdback liabilities, (vii) stock-based compensation expense, (viii) employer payroll tax related to stock-based compensation expense, (ix) acquisition-related expenses, (x) amortization of deferred other income from our IP License Agreement with SB Tempus, (xi) franchise taxes related to our IPO, and (xii) loss on debt extinguishment. We use adjusted EBITDA in conjunction with net income or loss, its corresponding GAAP measure, as a performance measure to assess our operating performance and operating leverage in our business. The above items are excluded from our adjusted EBITDA measure because these items are non-cash in nature, or because the amount and timing of these items is unpredictable, or they are not driven by core results of operations, thereby rendering comparisons with prior periods and competitors less meaningful. We believe adjusted EBITDA provides useful information to investors and others in understanding and evaluating our results of operations, as well as provides a useful measure for period-to-period comparisons of our business performance. Moreover, adjusted EBITDA is a key measurement used by our management internally to make operating decisions, including those related to analyzing operating expenses, evaluating performance, and performing strategic planning and annual budgeting. Adjusted EBITDA has limitations as a financial measure, should be considered as supplemental in nature, and is not meant as a substitute for, or superior to, the related financial information prepared in accordance with GAAP. Some of these limitations are that adjusted EBITDA: •does not reflect interest income which increases cash available to us; •excludes depreciation and amortization expense, and although these are non-cash expenses, the asset being depreciated may have to be replaced in the future, increasing our cash requirements; •does not reflect provision for or benefit from income taxes that reduces cash available to us; and •excludes change in fair value of marketable equity securities and indemnity-related holdback liabilities. Because of these limitations, we consider, and you should consider, adjusted EBITDA alongside other financial performance measures, including net income (loss) and our other GAAP results. A reconciliation of our adjusted EBITDA to net income (loss), the most directly comparable financial measure stated in accordance with GAAP, is provided below. Investors are encouraged to review the related GAAP financial measures and the reconciliation of the non-GAAP financial measure to their most directly comparable GAAP financial measure. 49 The following table summarizes our adjusted EBITDA, along with net loss, the most directly comparable GAAP measure, for each period presented below: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (unaudited) (in thousands) Net income (loss) $ 5,642 $ (42,843 ) $ (120,277 ) $ (110,880 ) Interest income (3,897 ) (1,093 ) (7,763 ) (2,906 ) Interest expense 10,283 21,579 24,624 39,582 Depreciation 7,125 8,347 14,550 16,230 Amortization 18,860 19,685 37,610 32,155 Provision for (benefit from) income taxes 309 212 247 (45,968 ) EBITDA $ 38,322 $ 5,887 $ (51,009 ) $ (71,787 ) Losses from equity method investments 2,864 2,100 5,950 3,983 Fair value changes(1) (97,401 ) (37,546 ) (66,260 ) (5,696 ) Stock-based compensation expense 54,121 22,455 106,827 45,429 Employer payroll tax related to stock-based compensation 1,493 1,873 5,051 7,126 Acquisition related expenses(2) 990 1,992 986 5,521 Amortization of technology license (3,988 ) (3,988 ) (7,977 ) (7,977 ) Franchise taxes related to IPO — 1,647 — 1,647 Loss on debt extinguishment 11,643 — 11,643 — Adjusted EBITDA $ 8,044 $ (5,580 ) $ 5,211 $ (21,754 ) (1)Fair value changes include gains and losses related to quarterly fair value adjustments of our marketable equity securities and indemnity-related holdback liabilities. (2)Acquisition related expenses consist of legal, diligence, accounting, and financing costs incurred for acquisitions during the three and six months ended June 30, 2026 and 2025. Liquidity and Capital Resources We have incurred significant losses and negative cash flows from operations since our inception, and as of June 30, 2026, we had an accumulated deficit of $2.5 billion. We expect to incur additional operating losses in the near future and our operating expenses will increase as we continue to invest and develop new offerings, expand our sales organization, and increase our marketing efforts to drive market adoption of our tests. As demand for our tests continues to increase from physicians and biopharmaceutical companies, we anticipate that our capital expenditure requirements could also increase if we require additional laboratory capacity. We have funded our operations to date principally from the sale of stock, convertible debt, term debt, the Revolving Credit Facility, and sales of our products. As of June 30, 2026, we had cash, cash equivalents and restricted cash of $604.3 million. Based on our current business plan, we believe our current cash and cash equivalents, marketable equity securities and anticipated cash flows from operations, will be sufficient to meet our anticipated cash requirements for more than twelve months from the date of this Quarterly Report on Form 10-Q. We may raise additional capital to expand our business, to pursue strategic investments, to take advantage of financing opportunities or for other reasons. As we grow our revenue, our accounts receivable and inventory balances will increase. Any increase in accounts receivable and inventory may not be completely offset by increases in accounts payable and accrued expenses, which could result in greater working capital requirements. If our available cash and cash equivalents and anticipated cash flows from operations are insufficient to satisfy our liquidity requirements because of lower demand for our products as a result of lower than currently expected rates of reimbursement from our customers or other risks described elsewhere in this Quarterly Report on Form 10-Q and in our Form 10-K for the year ended December 31, 2025, we may seek to sell additional common or preferred equity or convertible debt securities, enter into a credit facility or another form of third-party funding or seek other debt financing. The sale of equity and convertible debt securities, or exercise of warrants may result in dilution to our stockholders and, in the case of preferred equity securities or convertible debt, those securities could provide for rights, preferences or privileges senior to those of our common stock. The terms of debt securities issued 50 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 technologies or products or grant licenses on terms that are not favorable to us. Additional capital may not be available to us on reasonable terms, or at all. The failure to obtain any required future financing may require us to reduce or eliminate certain existing operations. Convertible Senior Notes Convertible Senior Notes due 2032 On May 12, 2026, we completed the 2026 Offering of $460.0 million aggregate principal amount of 0.00% Convertible Senior Notes due 2032, or the 2032 Notes. Our net proceeds from the 2026 Offering were $441.9 million, after deducting the initial purchasers' discount and commissions and offering expenses payable by us. The 2032 Notes are general unsecured obligations of ours and will mature on May 15, 2032. The 2032 Notes will not bear regular interest, and the principal amount of the 2032 Notes will not accrete. The 2032 Notes are convertible at the option of the holders prior to February 15, 2032, only upon satisfaction of one or more of the following conditions: (1)During any calendar quarter commencing after the calendar quarter ending on September 30, 2026, if the last reported sale price of our Class A common stock, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2032 Notes on each applicable trading day; (2)During the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the 2032 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our Class A common stock and the conversion rate for the 2032 Notes on each such trading day; (3)If we call such 2032 Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (4)Upon the occurrence of specified corporate events. On or after February 15, 2032, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2032 Notes at their option at any time, regardless of the foregoing conditions. Upon conversion, we will pay or deliver cash, shares of our Class A common stock or a combination of cash and shares of our common stock, at our election. The conversion rate for the 2032 Notes will initially be 14.4388 shares of the Company's Class A common stock per $1,000 principal amount of 2032 Notes, which is equivalent to an initial conversion price of approximately $69.26 per share of our Class A common Stock. The conversion rate is subject to adjustment under certain circumstances. On or after May 21, 2029, we may redeem for cash all or any portion of the 2032 Notes if the last reported sale price of our Class A common stock has been at least 130% of the conversion price for the 2032 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the 2032 Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date. If we redeem less than all the outstanding 2032 Notes, at least $75.0 million aggregate principal amount of 2032 Notes must be outstanding and not subject to redemption. No sinking fund is provided for the 2032 Notes. If we undergo a fundamental change (as defined in the indenture governing the 2032 Notes), then, subject to certain conditions and exceptions, noteholders may require us to repurchase for cash all or any portion of their 2032 Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2032 Notes to be repurchased, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date. The indenture governing the 2032 Notes contains customary terms and covenants, including that upon certain events of default either the 2032 Trustee or the holders of at least 25% in principal amount of the outstanding 2032 Notes may declare 100% of the principal of, and accrued and unpaid special interest, if any, on, all the 2032 Notes to be due and payable. If there is an event of default relating to failures by us to comply with certain reporting requirements, we may elect, at our option, that the sole remedy to consist exclusively of the right of the noteholders to receive special interest on the 2032 Notes for up to 365 days at a specified rate per annum of 0.25% of the principal amount for the first 180 days on which the special interest accrues, and thereafter at a rate of 0.50%. In connection with the pricing of the 2032 Notes on May 7, 2026, and the exercise in full by the initial purchasers of their option to purchase additional 2032 Notes on May 8, 2026, we entered into capped call transactions, or the 2032 Capped Call, with one of the 51 initial purchasers or its affiliate and other financial institutions. The 2032 Capped Call is expected generally to reduce the potential dilution to our Class A common stock upon any conversion of the 2032 Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted 2032 Notes, with such reduction and/or offset subject to a cap based on a cap price initially equal to $98.9400 per share, which is subject to certain adjustments under the terms of the 2032 Capped Call. The 2032 Capped Call have an initial strike price of approximately $69.26 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2032 Notes. The 2032 Capped Call cover, subject to anti-dilution adjustments, approximately 6,641,848 shares of our Class A common stock. Additionally, we paid approximately $31.2 million cost of the 2032 Capped Call from the proceeds of the 2026 Offering. We expect to use the remaining net proceeds from the 2026 Offering for general corporate purposes, which may include acquisitions or strategic investments in complementary businesses or technologies, working capital, operating expenses, capital expenditures and repayment of additional indebtedness. Convertible Senior Notes due 2030 On July 3, 2025, we completed a private offering, or the 2025 Offering, of $750.0 million aggregate principal amount of 0.75% Convertible Senior Notes due 2030, or the 2030 Notes. Our net proceeds from the 2025 Offering were $725.7 million, after deducting the initial purchasers' discount and commissions and offering expenses payable by us. The 2030 Notes are general unsecured obligations of ours and will mature on July 15, 2030. Interest on the 2030 Notes will accrue at a rate of 0.75% per year from July 3, 2025 and will be payable semiannually in arrears on January 15 and July 15 of each year, beginning on January 15, 2026. The 2030 Notes are convertible at the option of the holders prior to April 15, 2030, upon satisfaction of one or more of the following conditions: (1)During any calendar quarter, commencing after the fiscal quarter ending on September 30, 2025, if the last reported sale price of our Class A common stock, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2030 Notes on each applicable trading day; (2)During the five business day period after any ten consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of the 2030 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our Class A common stock and the conversion rate for the 2030 Notes on each such trading day; (3)If we call the 2030 Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (4)Upon the occurrence of specified corporate events. On or after April 15, 2030, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2030 Notes at their option at any time, regardless of the foregoing conditions. Upon conversion, we will pay or deliver cash, shares of our Class A common stock or a combination of cash and shares of our Class A common stock, at our election. The conversion rate for the 2030 Notes is 11.8778 shares of Class A common stock per $1,000 principal amount of 2030 Notes, which is equivalent to an initial conversion price of approximately $84.19 per share of our Class A common stock. The conversion rate is subject to adjustment under certain circumstances. On or after July 20, 2028, we may redeem for cash all or any portion of the 2030 Notes if the last reported sale price of our Class A common stock has been at least 130% of the conversion price for the 2030 Notes for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the 2030 Notes to be redeemed, plus accrued and unpaid interest. If we redeem less than all the outstanding 2030 Notes, at least $100.0 million aggregate principal amount of 2030 Notes must be outstanding and not subject to redemption. No sinking fund is provided for the 2030 Notes. If we undergo a fundamental change (as defined in the indenture governing the 2030 Notes), then, subject to certain conditions and exceptions, noteholders may require us to repurchase for cash all or any portion of their 2030 Notes at a fundamental change repurchase price equal to 100% of the principal amount of the 2030 Notes to be repurchased, plus accrued and unpaid interest, to, but excluding, the fundamental change repurchase date. 52 In connection with the pricing of the 2030 Notes on June 30, 2025, and in connection with the exercise in full by the initial purchasers of their option to purchase additional Notes on July 1, 2025, we entered into capped call transactions, or the 2030 Capped Call, effective as of July 3, 2025, with one of the initial purchasers and certain other financial institutions. The 2030 Capped Call is expected generally to reduce the potential dilution to our Class A common stock upon any conversion of the 2030 Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted 2030 Notes, with such reduction and/or offset subject to a cap based on a cap price initially equal to $111.1950 per share, which is subject to certain adjustments under the terms of the 2030 Capped Call. The 2030 Capped Calls have an initial strike price of approximately $84.19 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2030 Notes. The 2030 Capped Call cover, subject to anti-dilution adjustments, approximately 8,908,350 shares of our Class A common stock. Additionally, we paid approximately $41.8 million cost of the 2030 Capped Call from the proceeds of the 2025 Offering. We expect to use the remaining net proceeds from the 2025 Offering for general corporate purposes, which may include acquisitions or strategic investments in complementary businesses or technologies, working capital, operating expenses, capital expenditures and repayment of additional indebtedness. Credit Facilities On September 22, 2022, we entered into a Credit Agreement, or the Original Credit Agreement, with Ares Capital Corporation, or Ares, for a senior secured loan, or the Term Loan Facility that matures in September 2027, in an original principal amount of $175.0 million, less original issue discount of $4.4 million and deferred financing fees of $2.6 million. The Original Credit Agreement was amended on April 25, 2023 and October 11, 2023, to, among other things, increase the original principal amount of the Term Loan Facility by $85.0 million in the aggregate, less original issue discount of $2.2 million in the aggregate. On February 3, 2025, we entered into a Third Amendment Agreement, or the Third Amendment Agreement which, among other things, provided for an additional $200.0 million tranche of senior secured term loans, or the Additional Term Loan Facility, and together with the Term Loan Facility, the Term Loans, and $100.0 million in priority revolving loan commitments, or the Revolving Credit Facility, and loans thereunder, the Revolving Loans. We received $194.0 million under the Additional Term Loan Facility, which is the aggregate principal amount of $200.0 million, less original issue discount of $4.0 million and $2.0 million in legal fees paid to third parties, and $97.1 million in revolving loans under the Revolving Credit Facility, which is the aggregate amount of $100.0 million, less original issue discount of $2.0 million and $0.9 million in legal fees paid to third parties, the proceeds of which were used to fund the cash consideration for the Ambry Acquisition and to pay related fees. The Third Amendment Agreement was accounted for as a debt modification. The Additional Term Loan Facility and the Revolving Credit Facility mature on February 3, 2030. On June 30, 2025, in conjunction with the Offering, we entered into a Fourth Amendment to the Credit Agreement, or the Fourth Amendment Agreement. The Fourth Amendment Agreement amended the terms of the Credit Agreement to (i) permit the Offering and the related derivative transactions and (ii) provide that the Offering satisfies the junior capital raise requirement set forth in the Credit Agreement. Except as noted above, the material terms of the Credit Agreement were not amended. The Fourth Amendment Agreement was accounted for as a debt modification. The Term Loans and Revolving Credit Facility, or together with the Term Loan Facility, the Credit Facilities, are subject to quarterly interest payments for Base Rate loans and at the end of the applicable interest rate period for Term Secured Overnight Financing Rate, or SOFR, loans. The Term Loans are subject to quarterly interest payments, which bears interest based on Term SOFR. Additionally, we may make either a paid-in-kind, or PIK, election or a Cash election. Pursuant to the Original Credit Agreement, as amended by the Fourth Amendment Agreement, or the Credit Agreement, interest on the Term Loans accrues at a per annum rate as follows: (i) for any interest period for which we elect to pay interest in cash, the cash interest rate for Term SOFR borrowings will be Term SOFR plus a margin ranging from 6.75% to 7.75%, respectively, and (ii) for any interest period for which we elect to pay interest in kind, the cash interest rate for Term SOFR borrowings will be Term SOFR plus a margin of 5%, respectively, and the PIK interest rate will be 3.25%. Interest on the Revolving Loans accrues interest at a per annum rate equal to Term SOFR plus 3.75%. In July 2025, the Company repaid in full the principal amount of the Term Loan Facility for $276.9 million. In May 2026, the Company repaid in full the principal amount for $307.7 million of the Additional Term Loan Facility and Revolving Credit Facility. In connection with this repayment, the Credit Agreement, as amended, and all guarantee and security documents executed in connection therewith, were terminated. No amounts under the Credit Facilities remain outstanding as of June 30, 2026. 53 Convertible Promissory Note On February 22, 2025, we amended our convertible promissory note, or the Second Amended Note, with Google LLC, or Google, originally entered into on June 22, 2020, or the Initial Note, and subsequently amended on November 19, 2020, or the Amended Note. The amendment extended the maturity date of the Second Amended Note from March 22, 2026 to December 31, 2030. In addition, the amendment provides us the option upon maturity to repay up to 50% of the outstanding principal and accrued interest balance, or the Outstanding Amount, in shares of our Class A common stock equal to the quotient obtained by dividing (1) the Outstanding Amount on the maturity date, by (2) the average of the last trading price on each trading day during the twenty day period ending immediately prior to the maturity date. The principal balance of the Second Amended Note was reset to $238.8 million, which is the total of the then-outstanding principal and accrued interest. Consistent with the terms of the Amended Note, the Second Amended Note bears interest at a rate of 6.0% per annum, compounded annually. The principal amount is automatically reduced each year based on a formula taking into account the aggregate value of the Google Cloud Platform services used by us. We account for the principal reductions as an offset to its cloud and compute spend within selling, general and administrative in its condensed consolidated statements of operations and comprehensive loss. The Outstanding Amount under the Second Amended Note is due and payable on the earlier of (1) December 31, 2030, which is the maturity date of the Amended Note, (2) upon the occurrence and during the continuance of an event of default, and (3) upon the occurrence of an acceleration event, which includes any termination by us of the Google Cloud Platform agreement. We generally may not prepay the Outstanding Amount, except that we may, at our option, prepay the Outstanding Amount in an amount such that the principal amount remaining outstanding after such repayment is $150.0 million. At the Market Sales Agreement On August 8, 2025, we entered into a Controlled Equity OfferingSM Sales 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. The issuance and sale, if any, of shares of Class A Common Stock under the Sales Agreement will be made pursuant to an automatically effective registration statement on Form S-3 and the related prospectus included therein, or the ATM Prospectus, which was filed with the SEC on August 8, 2025. In accordance with the terms of the Sales Agreement, under the ATM Prospectus, we may offer and sell shares of Class A common stock having an aggregate offering price of up to $500.0 million from time to time through the Sales Agents. We did not sell any shares under the ATM during the three and six months ended June 30, 2026. In connection with the entry of the Sales Agreement and filing of the ATM Prospectus, we incurred $1.1 million of deferred offering costs to date, of which $0.8 million was reclassified as a reduction of paid-in-capital upon completion of the sales that occurred in 2025. The remaining deferred offering costs, which were incurred in anticipation of future ATM sales, are recorded in Prepaid and other assets on the consolidated balance sheet. As of June 30, 2026, approximately $300.0 million remained available for sale pursuant to the Sales Agreement and ATM Prospectus. Cash Flows The following table summarizes our cash flows for the periods presented: Six Months Ended June 30, 2026 2025 (unaudited) (in thousands) Net cash used in operating activities $ (80,802 ) $ (61,460 ) Net cash used in investing activities $ (21,159 ) $ (385,329 ) Net cash provided by financing activities $ 96,850 $ 293,042 Operating Activities Cash used in operating activities during the six months ended June 30, 2026 was $80.8 million, which resulted from a net loss of $120.3 million and a net change in our operating assets and liabilities of $84.5 million, offset by non-cash charges of $123.9 million. Non-cash charges primarily consisted of $106.8 million of stock-based compensation, $52.2 million of depreciation and amortization, $11.6 million loss on debt extinguishment, $6.9 million of non-cash operating lease costs, and $6.0 million of losses from equity method investments, offset by $66.2 million of gain on marketable equity securities. The net change in our operating assets and liabilities was primarily the result of a increase of $50.6 million in accounts receivable due to increased sales and the timing of customer payments and a decrease of $30.2 million in accounts payable and due to timing of payments. 54 Cash used in operating activities during the six months ended June 30, 2025 was $61.5 million, which resulted from a net loss of $110.9 million and a net change in our operating assets and liabilities of $10.4 million, offset by non-cash charges of $59.9 million. Non-cash charges primarily consisted of $48.4 million of depreciation and amortization, $45.4 million of stock-based compensation, $7.2 million of PIK interest added to principal, and $4.6 million of non-cash operating lease costs, offset by deferred income taxes of $46.2 million, and $6.0 million of gain on marketable equity securities. The net change in our operating assets and liabilities was primarily the result of a $49.2 million increase in accounts receivable due to increased sales and the timing of customer payments, offset by a $36.8 million increase in deferred revenue, which is primarily due to the Pathos Foundation Model agreement. Investing Activities Cash used in investing activities during the six months ended June 30, 2026 was $21.2 million, which was the result of purchases of property and equipment of $14.3 million and purchases of capitalized software of $6.8 million. Cash used in investing activities during the six months ended June 30, 2025 was $385.3 million, which was the result of $380.8 million cash paid related to the Ambry and Deep 6 acquisitions, purchases of property and equipment of $9.6 million, and $3.3 million of purchases of capitalized software from the Ambry Acquisition, offset by proceeds from the sale of marketable equity securities of $8.3 million. Financing Activities Cash provided by financing activities during the six months ended June 30, 2026 was $96.9 million, which was primarily due to the proceeds from convertible senior notes of $443.1 million, offset by $207.7 million of principal payments on long-term debt, $100.0 million principal payments on revolving credit facility, $31.2 million of purchases of capped call, and $6.4 million of prepayment premium on long-term debt. Cash provided by financing activities during the six months ended June 30, 2025 was $293.0 million, which was the result of net proceeds from the Additional Term Loan Facility of $196.0 million, and net proceeds from the Revolving Credit Facility of $98.0 million, offset by $1.0 million of payment of deferred financing fees. Off-Balance Sheet Arrangements We did not have during the period presented, and we do not currently have, any off-balance sheet financing arrangements or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Critical Accounting Policies and Estimates We have prepared our condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States, or GAAP. Our preparation of these condensed consolidated financial statements requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, expenses and related disclosures at the date of the condensed consolidated financial statements, as well as revenue and expenses recorded during the reporting periods. We evaluate our estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could therefore differ materially from these estimates under different assumptions or conditions. There have been no material changes to our critical accounting policies and estimates during the six months ended June 30, 2026 as described in the Form 10-K for the year ended December 31, 2025. Recent Accounting Pronouncements See the section titled “Summary of Significant Accounting Policies” in Note 2 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information. 55