Castle Biosciences Reports First Quarter 2026 Results
Rhea-AI Summary
Castle Biosciences (Nasdaq: CSTL) reported Q1 2026 revenue of $83.7 million and raised full-year 2026 revenue guidance to $345–355 million from $340–350 million. Core test reports (DecisionDx-Melanoma, TissueCypher) grew 36% year-over-year; DecisionDx-Melanoma test reports were 10,021.
Gross margin was 73% (Adjusted Gross Margin 76%), adjusted EBITDA was a $5.1 million loss, and cash plus investments totaled $261.7 million as of March 31, 2026.
Positive
- Revenue guidance raised to $345–355 million for 2026
- Core test reports growth of 36% year-over-year
- DecisionDx-Melanoma reports: 10,021 in Q1 2026
- TissueCypher reports: 11,745 in Q1 2026
- Cash and investments of $261.7 million
Negative
- GAAP revenue declined to $83.7M from $88.0M year-over-year
- Net loss of $14.5 million in Q1 2026
- Net cash used in operations of $22.1 million in Q1 2026
- Adjusted EBITDA loss of $5.1 million in Q1 2026
Key Figures
Market Reality Check
Peers on Argus
CSTL fell 3.61% while peers were mixed: CDNA down 2.4%, NEO down 1.66%, PSNL down 7.18%, and MYGN up 0.8%. Only one peer appeared in the momentum scanner, supporting a stock-specific move.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Nov 03 | Q3 2025 earnings | Positive | +21.7% | Q3 2025 revenue $83.0M and guidance raised to $327–335M. |
| Aug 04 | Q2 2025 earnings | Positive | +32.8% | Q2 2025 revenue $86.2M, guidance raised to $310–320M and net income $4.5M. |
| May 05 | Q1 2025 earnings | Positive | -11.4% | Q1 2025 revenue up 21% to $88M with higher guidance to $287–297M. |
| Feb 27 | FY 2024 results | Positive | -14.2% | 2024 revenue $332.1M, 51% growth, with net income $18.2M and strong margins. |
| Jan 12 | Prelim FY 2024 | Positive | -13.6% | Preliminary 2024 revenue expected at or above $320–330M guidance, 50%+ growth. |
Earnings releases have often been positive fundamentally but produced mixed to negative next-day moves, including several sizeable sell-offs despite revenue growth and guidance raises.
Over the last five earnings-related updates from Jan 2025 through Nov 2025, Castle Biosciences consistently reported strong revenue growth, rising test volumes and multiple guidance raises, with full‑year 2024 revenue reaching $332.1M and 2025 revenue around $344M. Despite these fundamentally positive trends, three of the five events saw double‑digit percentage declines the next day, while two (Q2 and Q3 2025) produced strong double‑digit gains. Today’s Q1 2026 report fits into this pattern of robust operational metrics alongside volatile price reactions.
Historical Comparison
In the past year, five earnings releases averaged a 3.08% move. Today’s -3.61% reaction to Q1 2026 results is weaker and opposite in direction to that typical earnings response.
Earnings updates show a trajectory from 2024 revenue of $332.1M and guidance of $280–295M for 2025 to later 2025 guidance increases up to $327–335M, followed by proxy disclosure of about $344M 2025 revenue and continued volume growth in core tests like DecisionDx‑Melanoma and TissueCypher.
Market Pulse Summary
This announcement highlights Q1 2026 revenue of $83.7M, strong 36% growth in core test volumes, and a higher 2026 revenue outlook of $345–355M. Investors may note improved gross margin at 73% and a narrower net loss of $14.5M, alongside weaker Adjusted EBITDA of -$5.1M. The company also reported cash and investments of $261.7M and new clinical data supporting DecisionDx‑Melanoma and TissueCypher, which could be important for long‑term adoption and reimbursement discussions.
Key Terms
adjusted gross margin financial
adjusted ebita financial
non-gaap financial measures financial
sentinel lymph node biopsy medical
janus kinase inhibitor medical
gene expression profile medical
national comprehensive cancer network medical
multicenter clinical study medical
AI-generated analysis. Not financial advice.
Delivered Q1 2026 revenue of
Q1 2026 total test reports for our core revenue drivers (DecisionDx®-Melanoma, TissueCypher®) increased
Raising full-year 2026 revenue guidance to
Conference call and webcast today at 4:30 p.m. ET
"The Castle Biosciences team delivered outstanding results to start 2026, delivering
"In addition, during the quarter we expanded the body of evidence supporting our market-leading DecisionDx-Melanoma test. Specifically, we announced new data from a prospective, multicenter,
First Quarter Ended Mar. 31, 2026, Financial and Operational Highlights
- Revenues were
$83.7 million $88.0 million - Revenues for our non-dermatologic tests were
$42.6 million $25.0 million
- Revenues for our non-dermatologic tests were
Core revenue drivers:
- First quarter 2026 total test reports for our core revenue drivers (DecisionDx-Melanoma, TissueCypher) increased
36% over the first quarter of 2025:- DecisionDx-Melanoma test reports delivered in the quarter were 10,021, compared to 8,621 in the first quarter of 2025.
- TissueCypher Barrett's Esophagus test reports delivered in the quarter were 11,745, compared to 7,432 in the first quarter of 2025.
Additional tests:
- DecisionDx-SCC test reports delivered in the quarter were 3,702, compared to 4,375 in the first quarter of 2025.
- MyPath® Melanoma test reports delivered in the quarter were 973, compared to 926 in the first quarter of 2025.
- DecisionDx®-UM test reports delivered in the quarter were 492, compared to 470 in the first quarter of 2025.
- Gross margin was
73% , and Adjusted Gross Margin was76% , compared to49% and81% , respectively, for the same periods in 2025. Affecting first quarter 2025 gross margin was the one-time adjustment of an acceleration of amortization expense of approximately$20.1 million - Net cash used in operations was
$22.1 million $6.0 million $28.8 million - Net loss, which includes non-cash stock-based compensation expense of
$9.8 million $14.5 million $25.8 million - Net loss per share, Basic and Diluted, was
$0.49 $0.90 $0.20 - Adjusted EBITDA was
$(5.1) million $13.0 million
Cash, Cash Equivalents and Marketable Investment Securities
As of Mar. 31, 2026, the Company's cash, cash equivalents and marketable investment securities totaled
2026 Outlook
Castle Biosciences is raising its guidance for anticipated total revenue in 2026. The Company now anticipates generating between
First Quarter and Recent Accomplishments and Highlights
Dermatology - Skin Cancer
- The Company presented new data at the 2026 American Academy of Dermatology Annual Meeting demonstrating that its DecisionDx-Melanoma test refines mortality risk within American Joint Committee on Cancer (AJCC) stages for patients with cutaneous melanoma (CM). The data showed that DecisionDx-Melanoma identifies clinically meaningful differences in mortality risk among patients within the same stage, which may help clinicians more confidently escalate care for higher-risk patients while avoiding unnecessary interventions in those at lower risk of poor outcomes. See the Company's news release from March 27, 2026, for more information.
- The Company also announced new data from a prospective, multicenter study evaluating DecisionDx-Melanoma's integrated sentinel lymph node biopsy (i31-SLNB) test result. The study data confirmed that the i31-SLNB accurately predicts SLN positivity and identifies low-risk patients who may safely consider forgoing SLNB while maintaining favorable long-term outcomes. These results expanded upon earlier publications from the same prospective, multicenter clinical study and further strengthened the growing body of evidence supporting the role of DecisionDx-Melanoma in guiding SLNB decision-making. The paper, available in Future Oncology, confirmed that DecisionDx-Melanoma's i31-SLNB identifies patients below the
5% National Comprehensive Cancer Network® (NCCN) threshold for forgoing sentinel lymph node biopsy and outperforms traditional staging criteria and other predictive gene expression profile (GEP) tests. See the Company's news release from March 9, 2026, for more information. - The Company presented new data at the European Congress of Dermato-Oncology (EADO) Congress and the American College of Mohs Surgery (ACMS) Annual Meeting demonstrating that its DecisionDx-Melanoma test provides independent, personalized prognostic information beyond AJCC staging, identifying biologically high-risk patients—including those with thin and early-stage disease—and supporting more precise, risk-aligned clinical management. See the Company's news release from April 21, 2026, for more information.
- The Company is supporting a series of initiatives across the country during May in recognition of Skin Cancer Awareness Month, including advocacy walks, community skin cancer screenings and patient education programs in collaboration with leading patient advocacy organizations. These efforts are aimed at expanding access to early detection, education and community-based resources to help prevent skin cancer and improve patient outcomes. See the Company's news release from May 5, 2026, for more information.
Gastroenterology
- The Company announced that new data from Mayo Clinic researchers, presented at Digestive Disease Week®, demonstrate that its TissueCypher test improves risk stratification and informs real-world management decisions for patients with Barrett's esophagus, including influencing surveillance intervals in more than half of patients and enabling more personalized, risk-aligned care. See the Company's news release from May 4, 2026, for more information.
Dermatology - Atopic Dermatitis
- The Company announced the publication of a prospective, multicenter clinical validation study in the Journal of the American Academy of Dermatology (JAAD) demonstrating that its AdvanceAD-Tx test can identify patients with moderate-to-severe atopic dermatitis who are significantly more likely to achieve greater and faster clinical responses when treated with a Janus kinase inhibitor compared to T helper type 2-targeted therapies. See the Company's news release from February 19, 2026, for more information.
Conference Call and Webcast Details
Castle Biosciences will hold a conference call on Wednesday, May 6, 2026, at 4:30 p.m. Eastern time to discuss its first quarter 2026 results and provide a corporate update.
A live webcast of the conference call can be accessed here: https://events.q4inc.com/attendee/621816679 or via the webcast link on the Investor Relations page of the Company's website, https://ir.castlebiosciences.com/overview/default.aspx. Please access the webcast at least 10 minutes before the conference call start time. An archive of the webcast will be available on the Company's website until May 27, 2026.
There will be a brief Question & Answer session following management commentary.
Use of Non-GAAP Financial Measures (UNAUDITED)
In this release, we use the metrics of Adjusted Revenues, Adjusted Gross Margin, Adjusted EBITDA and Adjusted Net Loss per Share, Basic and Diluted, which are non-GAAP financial measures and are not calculated in accordance with generally accepted accounting principles in
We use Adjusted Revenues, Adjusted Gross Margin, Adjusted EBITDA and Adjusted Net Loss per Share, Basic and Diluted, internally because we believe these metrics provide useful supplemental information in assessing our revenue and operating performance reported in accordance with GAAP, respectively. We believe that Adjusted Revenues, when used in conjunction with our test report volume information, facilitates investors' analysis of our current-period revenue performance and average selling price performance by excluding the effects of revenue adjustments related to test reports delivered in prior periods, since these adjustments may not be indicative of the current or future performance of our business. We believe that providing Adjusted Revenues may also help facilitate comparisons to our historical periods. Adjusted Gross Margin is calculated using Adjusted Revenues and therefore excludes the impact of revenue adjustments related to test reports delivered in prior periods, which we believe is useful to investors as described above. We further exclude acquisition-related intangible asset amortization in the calculation of Adjusted Gross Margin. We believe that excluding acquisition-related intangible asset amortization may facilitate gross margin comparisons to historical periods and may be useful in assessing current-period performance without regard to the historical accounting valuations of intangible assets, which are applicable only to tests we acquired rather than internally developed. Adjusted Net Loss per Share, Basic and Diluted, is calculated by excluding a one-time adjustment of an acceleration of amortization expense for our IDgenetix test from net loss. We believe that providing Adjusted Net Loss per Share, Basic and Diluted, may also help facilitate comparisons to our historical periods. We believe Adjusted EBITDA may enhance an evaluation of our operating performance because it excludes the impact of prior decisions made about capital investment, financing, investing and certain expenses we believe are not indicative of our ongoing performance. However, these non-GAAP financial measures may be different from non-GAAP financial measures used by other companies, even when the same or similarly titled terms are used to identify such measures, limiting their usefulness for comparative purposes.
These non-GAAP financial measures are not meant to be considered in isolation or used as substitutes for net revenues, gross margin, net loss or net loss per share reported in accordance with GAAP; should be considered in conjunction with our financial information presented in accordance with GAAP; have no standardized meaning prescribed by GAAP; are unaudited; and are not prepared under any comprehensive set of accounting rules or principles. In addition, from time to time in the future, there may be other items that we may exclude for purposes of these non-GAAP financial measures, and we may in the future cease to exclude items that we have historically excluded for purposes of these non-GAAP financial measures. Likewise, we may determine to modify the nature of adjustments to arrive at these non-GAAP financial measures. Because of the non-standardized definitions of non-GAAP financial measures, the non-GAAP financial measure as used by us in this press release and the accompanying reconciliation tables have limits in their usefulness to investors and may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies. Accordingly, investors should not place undue reliance on non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the tables at the end of this release.
About Castle Biosciences
Castle Biosciences (Nasdaq: CSTL) is a leading diagnostics company improving health through innovative tests that guide patient care. With a primary focus in dermatologic and gastroenterological disease, we develop personalized, clinically actionable solutions that help improve disease management and patient outcomes.
We put people first—empowering patients and clinicians and informing care decisions through rigorous science and advanced molecular tests that support more confident treatment planning. To learn more, visit www.CastleBiosciences.com and connect with us on LinkedIn, Facebook, X and Instagram.
DecisionDx-Melanoma, DecisionDx-CMSeq, i31-SLNB, i31-ROR, DecisionDx-SCC, MyPath Melanoma, AdvanceAD-Tx, TissueCypher, Esopredict, DecisionDx-UM, DecisionDx-PRAME and DecisionDx-UMSeq are trademarks of Castle Biosciences, Inc.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the "safe harbor" created by those sections. These forward-looking statements include, but are not limited to, statements concerning our expectations regarding: Castle's 2026 total revenue guidance of
CASTLE BIOSCIENCES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share data) | |||
Three Months Ended | |||
2026 | 2025 | ||
NET REVENUES | $ 83,679 | $ 87,988 | |
OPERATING EXPENSES | |||
Cost of sales (exclusive of amortization of acquired intangible assets) | 20,533 | 16,383 | |
Research and development | 14,428 | 12,588 | |
Selling, general and administrative | 64,899 | 58,620 | |
Amortization of acquired intangible assets | 2,226 | 28,325 | |
Total operating expenses, net | 102,086 | 115,916 | |
Operating loss | (18,407) | (27,928) | |
Interest income | 2,545 | 3,099 | |
Net gains (losses) on equity securities | 2,022 | (1,425) | |
Interest expense | (134) | (17) | |
Other loss | (439) | — | |
Loss before income taxes | (14,413) | (26,271) | |
Income tax expense (benefit) | 109 | (423) | |
Net loss | $ (14,522) | $ (25,848) | |
Loss per share, basic and diluted | $ (0.49) | $ (0.90) | |
Weighted-average shares outstanding, basic and diluted | 29,889 | 28,609 | |
Stock-Based Compensation Expense Stock-based compensation expense is included in the condensed consolidated statements of operations as follows (in | |||
Three Months Ended | |||
2026 | 2025 | ||
(unaudited) | |||
Cost of sales (exclusive of amortization of acquired intangible assets) | $ 1,257 | $ 1,456 | |
Research and development | 1,443 | 1,895 | |
Selling, general and administrative | 7,076 | 7,828 | |
Total stock-based compensation expense | $ 9,776 | $ 11,179 | |
CASTLE BIOSCIENCES, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED) (in thousands) | |||
Three Months Ended | |||
2026 | 2025 | ||
Net loss | $ (14,522) | $ (25,848) | |
Other comprehensive loss: | |||
Net unrealized loss on marketable investment securities | (330) | (99) | |
Comprehensive loss | $ (14,852) | $ (25,947) | |
CASTLE BIOSCIENCES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) | |||
March 31, | December 31, | ||
ASSETS | (unaudited) | ||
Current Assets | |||
Cash and cash equivalents | $ 63,764 | $ 116,729 | |
Marketable investment securities | 197,921 | 182,776 | |
Accounts receivable, net | 42,264 | 43,382 | |
Inventory | 10,461 | 10,254 | |
Prepaid expenses and other current assets | 14,491 | 7,956 | |
Total current assets | 328,901 | 361,097 | |
Long-term accounts receivable, net | 1,921 | 1,878 | |
Property and equipment, net | 100,934 | 97,443 | |
Operating lease assets | 14,424 | 14,795 | |
Goodwill and other intangible assets, net | 97,347 | 99,574 | |
Other assets – long-term | 4,278 | 3,769 | |
Total assets | $ 547,805 | $ 578,556 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current Liabilities | |||
Accounts payable | $ 15,038 | $ 18,711 | |
Accrued compensation | 19,111 | 38,287 | |
Contingent consideration | 1,000 | 1,000 | |
Operating lease liabilities | 1,254 | 1,325 | |
Current portion of long-term debt | 1,667 | 417 | |
Other accrued and current liabilities | 10,691 | 8,937 | |
Total current liabilities | 48,761 | 68,677 | |
Long-term debt | 8,399 | 9,640 | |
Noncurrent portion of contingent consideration | 1,500 | 1,500 | |
Noncurrent operating lease liabilities | 25,116 | 25,217 | |
Noncurrent finance lease liabilities | 288 | 314 | |
Deferred tax liability | 2,325 | 2,335 | |
Total liabilities | 86,389 | 107,683 | |
Stockholders' Equity | |||
Preferred stock | — | — | |
Common stock | 30 | 30 | |
Additional paid-in capital | 700,255 | 694,860 | |
Accumulated deficit | (238,806) | (224,284) | |
Accumulated other comprehensive (loss) income | (63) | 267 | |
Total stockholders' equity | 461,416 | 470,873 | |
Total liabilities and stockholders' equity | $ 547,805 | $ 578,556 | |
CASTLE BIOSCIENCES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) | |||
Three Months Ended March 31, | |||
2026 | 2025 | ||
OPERATING ACTIVITIES | |||
Net loss | $ (14,522) | $ (25,848) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 3,929 | 29,764 | |
Stock-based compensation expense | 9,776 | 11,179 | |
Net (gains) losses on equity securities | (2,022) | 1,425 | |
Deferred income taxes | (10) | (770) | |
Accretion of discounts on marketable investment securities | (454) | (1,435) | |
Other | 532 | 30 | |
Change in operating assets and liabilities: | |||
Accounts receivable | 1,075 | (5,217) | |
Prepaid expenses and other current assets | (6,667) | (3,364) | |
Inventory | (207) | 1,286 | |
Operating lease assets | 371 | 420 | |
Other assets | (530) | (38) | |
Accounts payable | 3,193 | 615 | |
Operating lease liabilities | (172) | (526) | |
Accrued compensation | (19,176) | (14,698) | |
Other accrued and current liabilities | 2,755 | 1,141 | |
Net cash used in operating activities | (22,129) | (6,036) | |
INVESTING ACTIVITIES | |||
Purchases of marketable investment securities | (55,136) | (48,431) | |
Proceeds from maturities of marketable investment securities | 39,100 | 36,300 | |
Purchases of debt securities classified as held-to-maturity | — | (5,569) | |
Proceeds from sale of equity securities | 2,681 | — | |
Purchases of property and equipment | (12,455) | (4,740) | |
Proceeds from sale of property and equipment | 7 | 9 | |
Net cash used in investing activities | (25,803) | (22,431) | |
FINANCING ACTIVITIES | |||
Proceeds from exercise of common stock options | 322 | 18 | |
Payment of employees' taxes on vested restricted stock units and performance-based restricted | (6,598) | (2,515) | |
Proceeds from contributions to the employee stock purchase plan | 1,267 | 970 | |
Repayment of principal portion of finance lease liabilities | (24) | (26) | |
Net cash used in financing activities | (5,033) | (1,553) | |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (52,965) | (30,020) | |
Beginning of period | 116,729 | 119,709 | |
End of period | $ 63,764 | $ 89,689 | |
CASTLE BIOSCIENCES, INC. Reconciliation of Non-GAAP Financial Measures (UNAUDITED) | |||
The table below presents the reconciliation of Adjusted Revenues, Adjusted Gross Margin and Adjusted Net | |||
Three Months Ended | |||
(in thousands, except per share data) | 2026 | 2025 | |
Adjusted Revenues | |||
Net revenues (GAAP) | $ 83,679 | $ 87,988 | |
Revenue associated with test reports delivered in prior periods | 551 | (787) | |
Adjusted Revenues (Non-GAAP) | $ 84,230 | $ 87,201 | |
Adjusted Gross Margin | |||
Gross margin (GAAP)1 | $ 60,920 | $ 43,280 | |
Amortization of acquired intangible assets | 2,226 | 28,325 | |
Revenue associated with test reports delivered in prior periods | 551 | (787) | |
Adjusted Gross Margin (Non-GAAP) | $ 63,697 | $ 70,818 | |
Gross Margin percentage (GAAP)2 | 72.8 % | 49.2 % | |
Adjusted Gross Margin percentage (Non-GAAP)3 | 75.6 % | 81.2 % | |
Adjusted Net Loss Per Share, Basic and Diluted | |||
Net loss (GAAP) | $ (14,522) | $ (25,848) | |
Amortization of acquired intangible assets4 | — | 20,099 | |
Adjusted Net Loss (Non-GAAP) | $ (14,522) | $ (5,749) | |
Weighted-average shares outstanding, basic and diluted: | 29,889 | 28,609 | |
Net loss per share, basic and diluted (GAAP)5 | $ (0.49) | $ (0.90) | |
Adjusted Net Loss Per Share, Basic and Diluted (Non-GAAP)6 | $ (0.49) | $ (0.20) | |
1. | Calculated as net revenues (GAAP) less the sum of cost of sales (exclusive of amortization of acquired intangible assets) and amortization of | ||||||||||
2. | Calculated as gross margin (GAAP) divided by net revenues (GAAP). | ||||||||||
3. | Calculated as Adjusted Gross Margin (Non-GAAP) divided by Adjusted Revenues (Non-GAAP). | ||||||||||
4. | Represents a one-time adjustment of an acceleration of amortization expense for our IDgenetix test during the three months ended March 31, | ||||||||||
5. | Calculated as net loss (GAAP) divided by weighted-average shares outstanding, basic and diluted. | ||||||||||
6. | Calculated as Adjusted Net Loss (Non-GAAP) divided by weighted-average shares outstanding, basic and diluted. | ||||||||||
The table below presents the reconciliation of Adjusted EBITDA, which is a non-GAAP financial measure. See "Use of Non-GAAP Financial Measures (UNAUDITED)" above for further information regarding the Company's use of non-GAAP financial measures.
Three Months Ended | |||
(in thousands) | 2026 | 2025 | |
Adjusted EBITDA | |||
Net loss | $ (14,522) | $ (25,848) | |
Interest income | (2,545) | (3,099) | |
Interest expense | 134 | 17 | |
Income tax expense (benefit) | 109 | (423) | |
Depreciation and amortization | 3,929 | 29,764 | |
Stock-based compensation expense | 9,776 | 11,179 | |
Net (gains) losses on equity securities | (2,022) | 1,425 | |
Adjusted EBITDA (Non-GAAP) | $ (5,141) | $ 13,015 | |
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SOURCE Castle Biosciences, Inc.