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Cathie Wood's Ark Invest Adjusts Portfolio, Divests Tempus AI Shares Amid Broader Rebalancing

Ark Invest Rebalances Holdings, Trims Tempus AI Stake Ark Invest, the investment management firm led by Cathie Wood, executed a series of significant portfolio adjustments, notably reducing its exposure to Tempus AI Inc. (NASDAQ: TEM) through the ARK Innovation ETF (ARKK). This divestment, totaling 62,352 shares valued at approximately $5.2 million at a closing price of $84.13 per share, comes amidst a broader strategic reallocation of capital towards specific opportunities within the biotechnology and autonomous technology sectors. Detailed Portfolio Adjustments Ark Invest's decision to trim its Tempus AI position occurred shortly after the company announced it had received FDA 510(k) clearance for its RNA-based Tempus xR IVD device on September 22, 2025. This device is an in vitro diagnostic tool intended to support drug development programs. Prior to this, Ark had made earlier sales of Tempus AI stock, including 43,157 shares for $3.76 million on September 18, and an additional $2.1 million worth of stock on September 9. Simultaneously, Ark Invest made several notable purchases: Arcturus Therapeutics Holdings Inc. (NASDAQ: ARCT): Ark Invest acquired 28,272 shares through its ARK Genomic Revolution ETF (ARKG), valued at $594,560. An additional 28,272 shares were purchased on September 25, underscoring a growing conviction in the biotech firm. Ares Acquisition Corporation II (NYSE: AACT): A substantial investment was made with the purchase of 85,142 shares through the ARKQ ETF, totaling $970,618. This follows previous acquisitions, indicating increasing interest in the Special Purpose Acquisition Company (SPAC) which recently approved a merger with Kodiak Robotics, Inc., set to reincorporate as Kodiak AI, Inc. and trade under the ticker KDK on Nasdaq. Pony AI Inc. (PONY): Ark Invest accumulated 3,627 shares through its ARKQ ETF, valued at $74,571, as part of an ongoing accumulation strategy in the autonomous driving sector. In addition to these buys, Ark Invest's largest dollar-value sale of the day, aside from Tempus AI, was in Roku Inc. (NASDAQ: ROKU), with sales totaling $4,643,067 through ARKK, indicating a bearish shift for the streaming device company within Ark's strategy. Analysis of Market Reaction and Ark's Rationale Despite the positive regulatory news for Tempus AI regarding its FDA clearance, the stock, which had previously traded up to approximately $97 and gained over 180% in the preceding year, experienced a pullback. Ark Invest's decision to reduce its position suggests a focus beyond immediate catalysts, potentially driven by concerns over Tempus AI's valuation and its path to sustainable profitability. The firm has been actively trimming what it perceives as overvalued tech stocks, aligning with a broader market trend where AI valuations are facing increased scrutiny, and investors are demanding clearer revenue streams over speculative growth. Financially, Tempus AI reported approximately $950 million in sales last year but incurred a loss of around $200 million. While projecting $1.25 billion in full-year 2025 revenue and an Adjusted EBITDA of $5 million, the company held a relatively low cash reserve of $300 million on its balance sheet given its ongoing cash burn. This financial context likely played a role in Ark Invest's assessment. Broader Context and Implications Ark Invest's recent trading activity underscores its evolving investment philosophy, prioritizing disruptive innovation within specific biotech and AI-driven segments that demonstrate robust long-term potential. The firm's pivot is a response to the demand for sustainable growth and a re-evaluation of market hype surrounding certain technology valuations. The stocks favored by Ark saw positive momentum. Arcturus Therapeutics experienced a nearly 9% surge on September 25, buoyed by Ark's accumulation and a "Strong Buy" consensus rating from Wall Street analysts, who project an average upside potential of nearly 200%. Arcturus also reported strong Q2 2025 financials, with revenue exceeding estimates and a reduced net loss. Similarly, Ares Acquisition Corporation II shares jumped 6.4% in extended trading following its merger approval. Pony AI surged 3.79% on September 22, with analysts from Goldman Sachs assigning a "Buy" rating and a $24.50 target, projecting over 50% upside. Pony AI's robotaxi revenue jumped 157.8% year-over-year in Q2 2025, reaching $1.5 million, highlighting its operational growth despite currently being profitless with a $7.3 billion market cap. Looking Ahead The market will closely monitor Tempus AI's operational execution and its trajectory toward profitability, especially in light of its $1.25 billion revenue projection for 2025 and its Adjusted EBITDA target. Furthermore, the performance of Ark Invest's newly favored holdings such as Arcturus Therapeutics, Kodiak AI, and Pony AI will serve as key indicators of the firm's strategic efficacy in identifying the next wave of disruptive innovation. The broader investment landscape continues to scrutinize AI** valuations, favoring companies with clear growth pathways and financial resilience over those with speculative prospects.