Ark Invest founder Cathie Wood has been one of the biggest champions of Tempus AI (TEM), the Chicago-based company that uses artificial intelligence for genome sequencing and precision medicine.
Back in February, Wood loaded up on TEM shares, acquiring 445,958 shares via her flagship Ark Innovation ETF (ARKK) and the ARK Genomic Revolution ETF (ARKG).
In fact, TEM is the largest portfolio holding for ARKG, with a 10.57% weighting and a market value of about $112.6 million.
Wood has been extremely bullish on the role that AI will play in innovating the medical industry. “I think the most underappreciated application of AI is healthcare,” she told CNBC in February.
“I think healthcare is responsible for an incredible amount of storage out there right now. Data is the name of the game.”
And its data advantage is something that Tempus AI has emphasized, claiming to have the world’s largest clinical and molecular database — a resource used by cardiologists, oncologists, research centers, and pharmaceutical companies.
But while Wood’s ETF holdings reflect her strong support for Tempus AI, a recent move has raised some eyebrows – and perhaps influenced some short sellers.
Wood sold off 107K TEM shares over the past few weeks from her ARKK fund, worth about $8 million.
After hitting an all-time high on Sept.22, Tempus AI’s stock plunged 19% over the next three days. But despite also falling 8.5% over the last five days, the stock has surged nearly 133% for the year.
Tempus AI’s momentum slows but doesn’t stop
It’s possible that Wood’s selloff has brought the bears out as the TEM shares have been heavily shorted recently, with its short interest hitting a record 25.7% last week, and now sitting at 25.3%.
The move by Wood comes as Tempus AI announced last week that it has received 510(k) clearance from the U.S. Food and Drug Administration (FDA) for its RNA-based Tempus xR IVD device.
This regulatory clearance means that the FDA has approved the device to be legally marketed in the United States.
Tempus AI notes that RNA sequencing “offers deeper insights into the mechanisms of diseases, including enhanced fusion detection,” while also identifying “molecular pathways and networks that are directly involved in disease progression.”
Dr. Kate Sasser, chief science officer at Tempus AI, said in a statement that the “FDA clearance further demonstrates the promise of RNA sequencing and opens up new opportunities for us with our biopharma customers.”
It’s unclear why Wood has decided to dump some of her Tempus AI shares, but it comes amid a larger selloff of AI or AI-adjacent stocks by ARK: The firm in recent weeks has also cut 138K shares of Advanced Micro Devices (AMD), worth $22 million, and 38K of Roblox (RBLX) shares, which has a market value of roughly $5 million.
The timing of the moves is interesting because Wood recently told Bloomberg that she believes the AI space has now become dominated by a “big four” that includes OpenAI, Anthropic, xAI and Gemini – and that number could even eventually be reduced to two, according to Wood.
However, the Ark Invest founder appeared to be speaking specifically about the LLM sector, even though some market watchers took it to mean the AI industry more broadly.
“I think the number of companies competing in the large language model space – truly competing – has shrunk,” Wood said.
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