This week technology earnings don’t just mark quarterly progress—they test structural assumptions. AMD (AMD: NASDAQ) will show whether it's still a credible alternative to Nvidia (NVDA: NASDAQ) and if the AI infrastructure buildout is still at full force. ON Semiconductor (ON: NASDAQ) might be our first clean read on the Trump tariffs’ effect on the non-AI part of the chip industry—the silent workhorses in autos and power management. 

And the big takeaway from last week’s huge RSA conference (a record 44,000 attendees): agentic AI isn’t a distant concept—it’s the next frontline in cybersecurity.

As always, I’m focused on three things:
1) Technology-driven change;
2) the latest in innovation and startup trends, and;
3) stock fraud.

Companies Discussed

In This Note:

• Companies Discussed

• Juked by the Genome?

• onsemi: 800 Volts vs. 145% Duties

• Tweet O’ The Week

• Epistrophy In The News

• 📆 of Epistrophy Events

• Availability This Week

Juked by the Genome?

Tempus AI (TEM: NASDAQ) positions itself as a leader in AI-driven precision medicine. But recent financial disclosures suggest that a meaningful portion of its reported growth is being driven by one-time accounting maneuvers rather than recurring revenue. And we could see more when the company reports earnings this week. The business is broken up into two revenue buckets: Genomics (65.1% of 2024 revenues) and Data and Services (34.9%). 

In Q4 2024, Tempus recognized $16.3 million in revenue by reversing a contract asset tied to canceled warrants from AstraZeneca (AZN: NASDAQ)—revenue booked without delivering new services.

The company’s 2024 results also include $23.1 million recognized from the sale of Recursion Pharmaceuticals (RXRX: NASDAQ) stock. That stock was received as payment for an AI-based licensing agreement, which permits Tempus to accept equity in lieu of cash. The original contract specified a $22 million upfront fee. That fee became revenue as soon as the shares were sold—unusual for a firm positioning itself as a data platform with predictable economics.

A similar pattern emerges with Tempus’ joint venture with SoftBank, “SB Tempus.” Tempus received $47.9 million in prepaid license fees, $8 million of which was recognized as revenue in 2024. The total license value roughly matches Tempus’ investment in the JV, suggesting that the transaction had limited external commercial validation. In a separate case, Tempus reported $4.5 million in revenue from Pathos AI, a firm founded by CEO Eric Lefkofsky and chaired by Tempus executives—raising related-party concerns.

Lefkofsky has followed this pattern before. Groupon (GRPN: NASDAQ), Echo Global Logistics, InnerWorkings, and Branden Apparel all featured aggressive growth claims early on, a cash out by Lefkofsky, followed by operational realities that took the bloom of the rose. Tempus may well develop into a sustainable AI healthcare business. But as of now, its reported performance relies heavily on one-time deals, internal partnerships, and financial structuring that obscures its underlying trajectory.

onsemi: 800 Volts vs. 145% Duties

onsemi’s (ON: NASDAQ) transformation is running out of road. After three years repositioning itself as a high-margin supplier to the electric vehicle and AI data center markets, the company now faces a geopolitical obstacle it didn’t engineer for: the return of Trump-era tariffs. With automotive sales already forecast to fall 25% sequentially in Q1 2025, onsemi risks compounding that downturn if tariffs undercut U.S. EV demand or unsettle global supply chains. “Entering Q1, we expect persisting volatility due to the geopolitical uncertainty across all geographies as our customers assess their manufacturing footprints and the impact of tariffs,” CEO Hassane El-Khoury said on the February 2025 earnings call.

That kind of caution is becoming more common from El-Khoury. Gone is the confident trajectory of silicon carbide growth, image sensor dominance, and Fab Right optimization. What remains is a company with a narrowing set of high-stakes bets—on electric vehicles, on AI, and now, on trade policy. The tariff threat doesn’t need to directly touch onsemi’s product catalog to be disruptive. It only needs to discourage OEMs from building, or consumers from buying, EVs in key markets. China is already in a post-holiday EV slump. Europe is slow. And in the U.S., tax credit confusion and charging infrastructure bottlenecks are doing much of the tariffs’ job already.

Technically, onsemi has tools. The company acquired Qorvo’s silicon carbide JFET business in Q4 2024, positioning itself as a supplier of voltage-switching solutions for next-gen AI power systems. It’s also pushing its new “Treo” analog and mixed-signal platform, which spans applications from EV zonal architecture to ultrasonic ADAS. But these aren’t revenue engines yet. JFET and Treo are architectural gambits aimed at hyperscalers and OEMs designing platforms for 2026 and beyond. Today’s gross margins and fab utilization are built on yesterday’s orders—and those are in decline.

The Q1 forecast makes that plain. Automotive revenue is projected to drop more than 25% sequentially, or roughly $260 million. That puts the business back near mid-2022 levels, but with a very different cost structure. onsemi’s fab utilization has slipped from 59% in Q4 to the “mid-50s” in Q1, exacerbating margin compression. Every 1% drop in fab utilization now translates to 20–25 basis points of margin loss. It’s not just volume that’s falling—it’s operating leverage.

onsemi’s broader model remains under pressure. Industrial sales, down 5% sequentially in Q4, continue to soften amid weak global PMIs. The company claims AI and defense grew 40–50% year-over-year, but these segments remain too small to break out separately. Image sensors, once a differentiator in automotive ADAS, have been quietly repositioned as niche “machine vision” components. And while El-Khoury insists that the company is still “under-shipping natural demand,” that’s a strategy based on hope, not backlog.

And what of onsemi’s domestic production? It’s East Fishkill, NY fab’s output depends on customer designs that are still years from volume. That’s not a problem in a rising market. It’s a problem now. The Q4 report shows $422 million in free cash flow, but that includes $157 million in capex and strategic inventory build. Base inventory days are already at 116. There’s not much room left to hide slow demand.

Trump’s new tariffs may not directly tax onsemi’s chips. But they hit where onsemi lives. They inject uncertainty into EV adoption, disrupt global sourcing, and slow the very industries that underpin the company’s growth narrative. onsemi’s strategy—to exit low-margin markets and specialize in high-value platforms—makes sense in theory. But it leaves the company exposed to a concentrated set of risks: China’s EV cycle, U.S. trade policy, and AI’s still-hypothetical power re-architecture.

The company’s long-term model still calls for 53% gross margins and 40% operating margins. CFO Thad Trent reiterated those goals in February, even as non-GAAP margins fell to 45.3% and gross profit compressed. But faith in that model now requires ignoring short-term gravity. With visibility limited, utilization falling, and political risk mounting, onsemi is heading into Q1 with more questions than answers. And if Trump’s tariffs stall EV adoption further, those questions may turn existential.

Tweet O’ The Week

Epistrophy In The News

On NewsNation last Friday, I walked through the collision of macro data and micro consequences: deceptive jobs and GDP report, eminent business problems from the Trump tariffs, and how for tech giants now straddling geopolitics and infrastructure. We discussed Apple (AAPL: NASDAQ)’s iPhone surge, Amazon (AMZN: NASDAQ)’s inventory, and why the RSA conference may have marked a pivot in cybersecurity’s public language. The full segment is here.

📆 of Epistrophy Events

Availability This Week

II’m in San Francisco all week, Seattle the week after and nearly back to full voice—90% recovered from what turned out to be a surprisingly persistent case of laryngitis. My voice was not built for whispering.

Plenty of time for catch-ups, prep calls or early-stage work on summer research. Written reports are available to clients, with video summaries on YouTube, and of course our popular summaries of the summaries on Instagram, TikTok, and YouTube Shorts.