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Castle Biosciences Reports Second Quarter 2024 Results

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Castle Biosciences (NASDAQ: CSTL) reported strong Q2 2024 results, with revenue increasing 74% to $87 million and total test reports up 49% year-over-year. The company raised its full-year 2024 revenue guidance to $275-300 million from $255-265 million. Key highlights include:

- Delivered 25,102 total test reports, up 49% from Q2 2023
- Gross margin improved to 81% from 74% in Q2 2023
- Net income of $8.9 million, compared to a net loss of $18.8 million in Q2 2023
- Adjusted EBITDA of $21.5 million, up from -$5.3 million in Q2 2023
- Cash, cash equivalents, and marketable securities totaled $259.7 million

The company highlighted positive developments for its DecisionDx-SCC and TissueCypher tests, including new clinical data and guideline recognition.

Castle Biosciences (NASDAQ: CSTL) ha riportato risultati forti per il secondo trimestre del 2024, con un aumento del fatturato del 74% a 87 milioni di dollari e un incremento del 49% dei rapporti di test totali rispetto all'anno precedente. L'azienda ha alzato le previsioni di fatturato per l'intero anno 2024 a 275-300 milioni di dollari da 255-265 milioni di dollari. I punti salienti includono:

- Forniti 25.102 rapporti di test totali, con un aumento del 49% rispetto al secondo trimestre del 2023
- Margine lordo migliorato all'81% rispetto al 74% del secondo trimestre del 2023
- Utile netto di 8,9 milioni di dollari, rispetto a una perdita netta di 18,8 milioni di dollari nel secondo trimestre del 2023
- EBITDA rettificato di 21,5 milioni di dollari, in crescita rispetto a -5,3 milioni di dollari nel secondo trimestre del 2023
- Liquidità, equivalenti di liquidità e titoli negoziabili per un totale di 259,7 milioni di dollari

L'azienda ha evidenziato sviluppi positivi per i suoi test DecisionDx-SCC e TissueCypher, compresi nuovi dati clinici e il riconoscimento delle linee guida.

Castle Biosciences (NASDAQ: CSTL) reportó resultados sólidos para el segundo trimestre de 2024, con un aumento del 74% en los ingresos a 87 millones de dólares y un incremento del 49% en los informes de pruebas totales en comparación con el año anterior. La empresa elevó su guía de ingresos para todo el año 2024 a 275-300 millones de dólares desde 255-265 millones de dólares. Los puntos destacados incluyen:

- Se entregaron 25,102 informes de pruebas totales, un aumento del 49% con respecto al segundo trimestre de 2023
- El margen bruto mejoró al 81% desde el 74% en el segundo trimestre de 2023
- Ingreso neto de 8.9 millones de dólares, en comparación con una pérdida neta de 18.8 millones de dólares en el segundo trimestre de 2023
- EBITDA ajustado de 21.5 millones de dólares, en comparación con -5.3 millones de dólares en el segundo trimestre de 2023
- Efectivo, equivalentes de efectivo y valores negociables totalizaron 259.7 millones de dólares

La empresa destacó desarrollos positivos para sus pruebas DecisionDx-SCC y TissueCypher, incluidos nuevos datos clínicos y el reconocimiento de las pautas.

Castle Biosciences (NASDAQ: CSTL)는 2024년 2분기 실적이 강세를 보였으며, 매출이 74% 증가하여 8,700만 달러에 달하고, 총 테스트 보고서가 전년 대비 49% 증가했다고 발표했습니다. 회사는 2024년 전체 연도 매출 가이드를 2억 7,500만-3억 달러로 상향 조정했으며, 이는 2억 5,500만-2억 6,500만 달러에서 증가한 수치입니다. 주요 내용은 다음과 같습니다:

- 총 25,102개의 테스트 보고서를 제공했으며, 2023년 2분기 대비 49% 증가했습니다.
- 총 마진이 2023년 2분기 74%에서 81%로 개선되었습니다.
- 순이익이 890만 달러로, 2023년 2분기 1,880만 달러의 순손실에 비해 개선되었습니다.
- 조정 EBITDA가 2,150만 달러로, 2023년 2분기 -530만 달러에서 상승했습니다.
- 현금, 현금성 자산 및 유동성 자산이 총 2억 5,970만 달러에 달했습니다.

회사는 DecisionDx-SCC 및 TissueCypher 테스트에 대한 긍정적인 발전을 강조했으며, 여기에는 새로운 임상 데이터와 가이드라인 인식이 포함되어 있습니다.

Castle Biosciences (NASDAQ: CSTL) a rapporté des résultats solides pour le deuxième trimestre 2024, avec une augmentation des revenus de 74 % atteignant 87 millions de dollars et une hausse de 49 % des rapports de tests totaux par rapport à l'année précédente. L'entreprise a relevé sa prévision de revenus pour l'année entière 2024 à 275-300 millions de dollars contre 255-265 millions de dollars précédemment. Les principaux points forts incluent:

- Livraison de 25 102 rapports de tests totaux, en hausse de 49 % par rapport au deuxième trimestre 2023
- Marge brute améliorée à 81 % contre 74 % au deuxième trimestre 2023
- Revenu net de 8,9 millions de dollars, comparé à une perte nette de 18,8 millions de dollars au deuxième trimestre 2023
- EBITDA ajusté de 21,5 millions de dollars, contre -5,3 millions de dollars au deuxième trimestre 2023
- Liquidités, équivalents de liquidités et titres négociables totalisant 259,7 millions de dollars

L'entreprise a souligné des développements positifs pour ses tests DecisionDx-SCC et TissueCypher, y compris de nouvelles données cliniques et la reconnaissance des lignes directrices.

Castle Biosciences (NASDAQ: CSTL) meldete starke Ergebnisse für das 2. Quartal 2024, mit einem Umsatzanstieg von 74 % auf 87 Millionen US-Dollar und einer Steigerung der gesamten Testberichte um 49 % im Jahresvergleich. Das Unternehmen hob seine Umsatzprognose für das Gesamtjahr 2024 auf 275 bis 300 Millionen US-Dollar von zuvor 255 bis 265 Millionen US-Dollar an. Zu den wichtigsten Highlights gehören:

- Bereitstellung von 25.102 Gesamt-Testberichten, ein Anstieg von 49 % gegenüber dem 2. Quartal 2023
- Bruttomarge verbesserte sich auf 81 % im Vergleich zu 74 % im 2. Quartal 2023
- Nettogewinn von 8,9 Millionen US-Dollar, im Vergleich zu einem Nettverlust von 18,8 Millionen US-Dollar im 2. Quartal 2023
- Bereinigtes EBITDA von 21,5 Millionen US-Dollar, im Vergleich zu -5,3 Millionen US-Dollar im 2. Quartal 2023
- Bargeld, Zahlungsmitteläquivalente und handelbare Wertpapiere summierten sich auf insgesamt 259,7 Millionen US-Dollar

Das Unternehmen hob positive Entwicklungen für seine Tests DecisionDx-SCC und TissueCypher hervor, darunter neue klinische Daten und die Anerkennung von Richtlinien.

Positive
  • Q2 2024 revenue increased 74% year-over-year to $87 million
  • Total test reports delivered increased 49% to 25,102 in Q2 2024
  • Full-year 2024 revenue guidance raised to $275-300 million
  • Gross margin improved to 81% from 74% in Q2 2023
  • Net income of $8.9 million in Q2 2024, compared to a net loss of $18.8 million in Q2 2023
  • Adjusted EBITDA of $21.5 million, up from -$5.3 million in Q2 2023
  • Strong cash position with $259.7 million in cash, cash equivalents, and marketable securities
Negative
  • DecisionDx-UM test reports decreased 1% year-over-year in Q2 2024

Insights

Castle Biosciences' Q2 2024 results demonstrate exceptional growth and financial strength. The company reported a 74% increase in revenue to $87 million, significantly outpacing the previous year. Test report volumes grew by 49%, indicating strong market adoption across their portfolio. Notably, the TissueCypher Barrett's Esophagus test saw a 230% increase in deliveries.

The company's gross margin improved to 81% from 74% last year, showing enhanced operational efficiency. With $259.7 million in cash and equivalents, Castle Biosciences has a robust balance sheet to support future growth. The raised full-year revenue guidance to $275-300 million signals management's confidence in continued strong performance.

The publication of Castle Biosciences' DecisionDx-SCC study in the prestigious Red Journal is a significant achievement. This research, the largest of its kind, demonstrates the test's ability to guide adjuvant radiation therapy decisions in high-risk cutaneous squamous cell carcinoma patients. The potential to avoid unnecessary treatment and improve patient quality of life is substantial.

Additionally, the American Gastroenterological Association's recognition of tissue-based biomarker testing, including TissueCypher, in its Clinical Practice Guideline is a major validation. This acknowledgment could drive increased adoption of the test in identifying high-risk Barrett's esophagus patients who may benefit from early intervention, potentially expanding the test's market.

Castle Biosciences' diverse test portfolio is showing strong market traction. The DecisionDx-SCC test's 60% growth and TissueCypher's 230% increase in deliveries are particularly impressive. The company's expansion into mental health with the IDgenetix test, which saw an 83% increase in reports, demonstrates successful market diversification.

The recognition of Castle Biosciences' CEO as an Entrepreneur Of The Year® 2024 Gulf South Award winner enhances the company's reputation and visibility. This, combined with the multiple clinical validations and guideline inclusions, positions the company well for continued market penetration and potential leadership in precision medicine diagnostics.

Q2 2024 revenue increased 74% over Q2 2023 to $87 million

Q2 2024 total test reports increased 49% over Q2 2023

Raising full-year 2024 revenue guidance to $275-300 million from $255-265 million

Conference call and webcast today at 4:30 p.m. ET

FRIENDSWOOD, Texas--(BUSINESS WIRE)-- Castle Biosciences, Inc. (Nasdaq: CSTL), a company improving health through innovative tests that guide patient care, today announced its financial results for the second quarter and six months ended June 30, 2024.

“We achieved another quarter of exceptional performance, thanks to the hard work of our talented team and strength of our innovative test portfolio,” said Derek Maetzold, president and chief executive officer of Castle Biosciences. “We were especially pleased with the substantial top-line growth as well as growth in test report volumes across our therapeutic areas."

“Regarding our DecisionDx®-SCC test, we were also pleased to see the publication of our first study evaluating the use of DecisionDx-SCC to guide adjuvant radiation therapy (ART) recommendations in patients diagnosed with high-risk cutaneous squamous cell carcinoma (SCC). This study, which is the largest study to evaluate the effectiveness of ART in SCC, found that the DecisionDx-SCC test can identify patients who are considering ART under traditional clinicopathologic risk features and have a low likelihood of metastasis and a low likelihood of a receiving a clinical benefit from ART – thus enabling deferral of radiation therapy and avoidance of complications and associated impacts on the patient’s quality of life. This study was published in the American Society for Radiation Oncology’s flagship journal, International Journal of Radiation Oncology, Biology, Physics (also known as the Red Journal).

“Regarding our TissueCypher® Barrett’s Esophagus test, the American Gastroenterological Association (AGA) recently recognized in its Clinical Practice Guideline that there is a high-risk subset of non-dysplastic Barrett’s esophagus patients who may benefit from early intervention with endoscopic eradication therapy (EET) and importantly, acknowledged that tissue-based biomarker testing, including the tissue systems pathology test (i.e., TissueCypher, also known as TSP-9) can help identify these patients.

“We believe we are well-positioned for near- and long-term success, supported by the potential for continued growth across our portfolio, as well as by our robust balance sheet and proven track record of strong execution. I am proud of what we have accomplished, and we will continue to work to operate with speed and agility to deliver value to patients, clinicians and stockholders alike."

Second Quarter Ended June 30, 2024, Financial and Operational Highlights

  • Revenues were $87.0 million, a 74% increase compared to $50.1 million in the second quarter of 2023. Included in revenue for the period were revenue adjustments related to tests delivered in prior periods. These prior period revenue adjustments for the quarter were $0.4 million of net positive revenue adjustments, compared to $0.1 million of net negative revenue adjustments for the same period in 2023.
  • Adjusted Revenues, which exclude the effects of revenue adjustments related to tests delivered in prior periods, were $86.6 million, a 72% increase compared to $50.2 million for the same period in 2023.
  • Delivered 25,102 total test reports in the second quarter of 2024, an increase of 49% compared to 16,820 in the same period of 2023:
    • DecisionDx®-Melanoma test reports delivered in the quarter were 9,585, compared to 8,597 in the second quarter of 2023, an increase of 11%.
    • DecisionDx-SCC test reports delivered in the quarter were 4,277, compared to 2,681 in the second quarter of 2023, an increase of 60%.
    • MyPath® Melanoma test reports delivered in the quarter were 1,099, compared to 953 in the second quarter of 2023, an increase of 15%.
    • TissueCypher Barrett’s Esophagus test reports delivered in the quarter were 4,782, compared to 1,447 in the second quarter of 2023, an increase of 230%.
    • IDgenetix® test reports delivered in the quarter were 4,903, compared to 2,681 in the second quarter of 2023, an increase of 83%.
    • DecisionDx®-UM test reports delivered in the quarter were 456, compared to 461 in the second quarter of 2023, a decrease of 1%.
  • Gross margin was 81%, and Adjusted Gross Margin was 83%, compared to 74% and 78%, respectively, for the same periods in 2023.
  • Net cash provided by operations was $24.0 million, compared to $3.8 million net cash used in operations for the same period in 2023.
  • Net income, which includes non-cash stock-based compensation expense of $13.2 million, was $8.9 million, compared to a net loss of $(18.8) million for the same period in 2023.
  • Adjusted EBITDA was $21.5 million, compared to $(5.3) million for the same period in 2023.

Six Months Ended June 30, 2024, Financial and Operational Highlights

  • Revenues were $160.0 million, a 74% increase compared to $92.2 million during the same period in 2023. Included in revenue for the period were revenue adjustments related to tests delivered in prior periods. These prior period revenue adjustments for the six months ended June 30, 2024, were $1.0 million of net positive revenue adjustments, compared to $1.7 million of net negative revenue adjustments for the same period in 2023.
  • Adjusted Revenues, which exclude the effects of revenue adjustments related to tests delivered in prior periods, were $159.0 million, a 69% increase compared to $93.9 million for the same period in 2023.
  • Delivered 45,990 total test reports in the six months ended June 30, 2024, an increase of 45% compared to 31,736 in the same period of 2023:
    • DecisionDx-Melanoma test reports delivered in the six months ended June 30, 2024, were 17,969, compared to 16,180 for the same period in 2023, an increase of 11%.
    • DecisionDx-SCC test reports delivered in the six months ended June 30, 2024, were 7,854, compared to 5,092 for the same period in 2023, an increase of 54%.
    • MyPath Melanoma test reports delivered in the six months ended June 30, 2024, were 2,097, compared to 1,933 for the same period in 2023, an increase of 8%.
    • TissueCypher Barrett’s Esophagus test reports delivered in the six months ended June 30, 2024, were 8,211, compared to 2,830 for the same period in 2023, an increase of 190%.
    • IDgenetix test reports delivered in the six months ended June 30, 2024, were 8,981, compared to 4,831 for the same period in 2023, an increase of 86%.
    • DecisionDx-UM test reports delivered in the six months ended June 30, 2024, were 878, compared to 870 for the same period in 2023, an increase of 1%.
  • Gross margin for the six months ended June 30, 2024, was 79%, and Adjusted Gross Margin was 82%.
  • Net cash provided by operations was $17.2 million, compared to $29.2 million net cash used in operations for the same period in 2023.
  • Net income for the six months ended June 30, 2024, which includes non-cash stock-based compensation expense of $25.9 million, was $6.4 million, compared to a net loss of $(48.0) million for the same period in 2023.
  • Adjusted EBITDA for the six months ended June 30, 2024, was $32.1 million, compared to $(20.4) million for the same period in 2023.

Cash, Cash Equivalents and Marketable Investment Securities

As of June 30, 2024, the Company’s cash, cash equivalents and marketable investment securities totaled $259.7 million.

2024 Outlook

Based upon revenue generated through June 30, 2024, the Company is increasing its guidance for anticipated total revenue in 2024 to between $275–300 million, compared to the previously provided guidance of between $255–265 million.

Second Quarter and Recent Accomplishments and Highlights

Dermatology

  • DecisionDx-SCC: The Company announced the publication of a study in the International Journal of Radiation Oncology, Biology, Physics (Red Journal) demonstrating the ability of the DecisionDx-SCC test to identify high-risk SCC patients who are likely to benefit from ART to reduce metastatic disease progression, as well as high-risk patients who are unlikely to benefit from ART and who, therefore, may consider deferring treatment. This study is the single largest study ever conducted to evaluate the effectiveness of ART in patients diagnosed with SCC and demonstrates the impact of the test in guiding decision-making for recommending ART. See the Company’s news release from May 29, 2024, for more information.
  • DecisionDx-SCC: The Company also shared new data that supported the utility of DecisionDx-SCC in patients with high-risk SCC tumors located on the head and neck at the 56th American College of Mohs Surgery (ACMS) Annual Meeting in Phoenix. Data presented demonstrated that testing with DecisionDx-SCC significantly increased the prediction accuracy of metastatic events, when used alone and when combined with National Comprehensive Cancer Network (NCCN) guidelines, Brigham and Women’s Hospital (BWH) staging or American Joint Committee on Cancer Staging Manual, 8th Edition (AJCC8) staging, to better guide risk-aligned patient care decisions regarding metastatic surveillance or the use of adjuvant treatments like radiation. See the Company’s news release from May 3, 2024, for more information.
  • DecisionDx-Melanoma: The Company presented new data relating to its DecisionDx-Melanoma test at the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting in Chicago, demonstrating the test’s ability to identify patients with localized cutaneous melanoma at the highest risk of metastasis to the central nervous system (CNS). Specifically, the study showed that DecisionDx-Melanoma can identify patients with earlier-stage melanoma who have a higher risk of CNS metastasis within the first three years post-diagnosis. These higher-risk patients may benefit from more frequent imaging surveillance to identify CNS metastases earlier to improve patient survival. See the Company’s news release from May 30, 2024, for more information.

Gastroenterology

  • The Company announced that the AGA published new clinical practice guidelines for EET to treat Barrett’s esophagus (BE) and prevent its progression to esophageal adenocarcinoma. These guidelines recognized that there is a high-risk subset of patients with non-dysplastic BE (NDBE) who may benefit from early intervention with EET and acknowledged the role that tissue-based biomarkers, including TissueCypher, can play in identifying these patients. See the Company’s news release from June 24, 2024, for more information.
  • The Company also shared three abstracts supporting the ability of its TissueCypher test to predict risk of progression to esophageal cancer in patients with BE at the Digestive Disease Week (DDW) 2024 Annual Meeting in Washington, D.C. The data that was shared further expanded the substantial clinical evidence supporting TissueCypher and its ability to improve the care that BE patients receive. See the Company’s news release from May 14, 2024, for more information.

Mental Health

  • The Company was selected as the winner of the “Best Overall Mental Health Solution” award in the eighth annual MedTech Breakthrough Awards program for its IDgenetix pharmacogenomic (PGx) test. The MedTech Breakthrough Awards honor excellence and recognize innovation, hard work and success in a range of health and medical technology categories, attracting thousands of nominations from over 18 countries across the world. See the Company’s news release from May 10, 2024, for more information.

Uveal Melanoma

  • The Company announced results from the largest prospective study to date of patients with uveal melanoma, titled “15-Gene Expression Profile and PRAME as Integrated Prognostic Test for Uveal Melanoma: First Report of Collaborative Ocular Oncology Group Study No. 2 (COOG2.1),” confirming the prognostic accuracy of the DecisionDx-UM test and providing the first prospective validation of Preferentially Expressed Antigen in Melanoma (PRAME) status as a risk refinement tool when considered in the context of a Class 1 or Class 2 DecisionDx-UM result. The study data demonstrated that together, these two tests can guide more precise and risk-aligned decision-making for patients with UM, including referrals, intensity of imaging surveillance and eligibility for ongoing clinical trials. See the Company’s news release from May 8, 2024, and the published paper in the Journal of Clinical Oncology for more information.

Corporate

  • The Company announced that its founder, president and chief executive officer, Derek Maetzold, was named by Ernst & Young LLP (EY) as an Entrepreneur Of The Year® 2024 Gulf South Award winner. Now in its 38th year, Entrepreneur Of The Year is the preeminent competitive awards program that celebrates entrepreneurs and leaders of high-growth companies who disrupt markets, revolutionize sectors and have a transformational impact on lives. See the Company’s news release from June 14, 2024, for more information.

Conference Call and Webcast Details

Castle Biosciences will hold a conference call on Monday, August 5, 2024, at 4:30 p.m. Eastern time to discuss its second quarter 2024 results and provide a corporate update.

A live webcast of the conference call can be accessed here: https://events.q4inc.com/attendee/952012940 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 August 26, 2024.

To access the live conference call via phone, please dial 833 470 1428 from the United States, or +1 404 975 4839 internationally, at least 10 minutes prior to the start of the call, using the conference ID 802518.

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 and Adjusted EBITDA, which are non-GAAP financial measures and are not calculated in accordance with generally accepted accounting principles in the United States (GAAP). Adjusted Revenues and Adjusted Gross Margin reflect adjustments to GAAP net revenues to exclude net positive and/or net negative revenue adjustments recorded in the current period associated with changes in estimated variable consideration related to test reports delivered in previous periods. Adjusted Gross Margin further excludes acquisition-related intangible asset amortization. Adjusted EBITDA excludes from net income (loss): interest income, interest expense, income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, change in fair value of contingent consideration and acquisition related transaction costs.

We use Adjusted Revenues, Adjusted Gross Margin and Adjusted EBITDA 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. 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 or net income (loss) 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. The Company aims to transform disease management by keeping people first: patients, clinicians, employees and investors.

Castle’s current portfolio consists of tests for skin cancers, Barrett’s esophagus, mental health conditions and uveal melanoma. Additionally, the Company has active research and development programs for tests in other diseases with high clinical need, including its test in development to help guide systemic therapy selection for patients with moderate-to-severe, atopic dermatitis, psoriasis and related conditions. To learn more, please visit www.CastleBiosciences.com and connect with us on LinkedIn, Facebook, X and Instagram.

DecisionDx-Melanoma, DecisionDx-CMSeq, DecisionDx-SCC, MyPath Melanoma, DiffDx-Melanoma, TissueCypher, IDgenetix, 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: (i) our 2024 total revenue guidance of $275-300 million; (ii) the potential of our tests to improve patient outcomes, including increased survival; (iii) our continued commercial momentum in 2024; (iv) our ability to continue to develop evidence to support the clinical utility of our tests; and (v) our ability to achieve near- and long-term success and the continued growth of our portfolio. The words “anticipate,” “can,” “could,” “expect,” “goal,” “may,” “plan” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation: our assumptions or expectations regarding continued reimbursement for our DecisionDx-SCC test at the current rate and reimbursement for our other products and subsequent coverage decisions, our estimated total addressable markets for our products and product candidates and the related expenses, capital requirements and potential needs for additional financing, the anticipated cost, timing and success of our product candidates, and our plans to research, develop and commercialize new tests and our ability to successfully integrate new businesses, assets, products or technologies acquired through acquisitions, the effects of macroeconomic events and conditions, including inflation and monetary supply shifts, labor shortages, liquidity concerns at, and failures of, banks and other financial institutions or other disruptions in the banking system or financing markets and recession risks, supply chain disruptions, outbreaks of contagious diseases and geopolitical events (such as the ongoing Israel-Hamas War and Ukraine-Russia conflict), among others, on our business and our efforts to address its impact on our business; subsequent study or trial results and findings may contradict earlier study or trial results and findings or may not support the results discussed in this press release, including with respect to the tests discussed in this press release; our planned installation of additional equipment and supporting technology infrastructures and implementation of certain process efficiencies may not enable us to increase the future scalability of our TissueCypher Test; actual application of our tests may not provide the aforementioned benefits to patients; our newer gastroenterology and mental health franchises may not contribute to the achievement of our long-term financial targets as anticipated; and the risks set forth under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, each filed or to be filed with the SEC, and in our other filings with the SEC. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements, except as may be required by law.

 

CASTLE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

(in thousands, except per share data)

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

NET REVENUES

$

87,002

 

 

$

50,138

 

 

$

159,976

 

 

$

92,175

 

OPERATING EXPENSES

 

 

 

 

 

 

 

Cost of sales (exclusive of amortization of acquired intangible asset)

 

14,519

 

 

 

11,058

 

 

 

28,413

 

 

 

21,240

 

Research and development

 

14,136

 

 

 

13,308

 

 

 

27,945

 

 

 

27,701

 

Selling, general and administrative

 

51,088

 

 

 

44,681

 

 

 

99,583

 

 

 

91,443

 

Amortization of acquired intangible asset

 

2,247

 

 

 

2,248

 

 

 

4,494

 

 

 

4,470

 

Total operating expenses, net

 

81,990

 

 

 

71,295

 

 

 

160,435

 

 

 

144,854

 

Operating income (loss)

 

5,012

 

 

 

(21,157

)

 

 

(459

)

 

 

(52,679

)

Interest income

 

3,144

 

 

 

2,399

 

 

 

6,140

 

 

 

4,735

 

Interest expense

 

(270

)

 

 

(3

)

 

 

(284

)

 

 

(7

)

Income (loss) before income taxes

 

7,886

 

 

 

(18,761

)

 

 

5,397

 

 

 

(47,951

)

Income tax (benefit) expense

 

(1,034

)

 

 

16

 

 

 

(989

)

 

 

30

 

Net income (loss)

$

8,920

 

 

$

(18,777

)

 

$

6,386

 

 

$

(47,981

)

 

 

 

 

 

 

 

 

Earnings (loss) per share:

 

 

 

 

 

 

 

Basic

$

0.32

 

 

$

(0.70

)

 

$

0.23

 

 

$

(1.80

)

Diluted

$

0.31

 

 

$

(0.70

)

 

$

0.22

 

 

$

(1.80

)

 

 

 

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

Basic

 

27,646

 

 

 

26,733

 

 

 

27,566

 

 

 

26,670

 

Diluted

 

28,738

 

 

 

26,733

 

 

 

28,542

 

 

 

26,670

 

 

 

 

 

 

 

 

 

Stock-Based Compensation Expense

Stock-based compensation expense is included in the unaudited condensed consolidated statements of operations as follows (in thousands):

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Cost of sales (exclusive of amortization of acquired intangible assets)

$

1,401

 

$

1,202

 

$

2,715

$

2,474

Research and development

 

2,637

 

 

 

2,486

 

 

 

5,266

 

 

5,073

 

Selling, general and administrative

 

9,141

 

 

 

9,161

 

 

 

17,873

 

 

18,827

 

Total stock-based compensation expense

$

13,179

 

 

$

12,849

 

 

$

25,854

 

$

26,374

 

 

CASTLE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

(in thousands)

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Net income (loss)

$

8,920

 

 

$

(18,777

)

 

$

6,386

 

 

$

(47,981

)

Other comprehensive (loss) income:

 

 

 

 

 

 

 

Net unrealized (loss) gain on marketable investment securities

 

(61

)

 

 

(8

)

 

 

(308

)

 

 

237

 

Comprehensive income (loss)

$

8,859

 

 

$

(18,785

)

 

$

6,078

 

 

$

(47,744

)

 

CASTLE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 

 

June 30,

2024

 

December 31,

2023

ASSETS

(unaudited)

 

 

Current Assets

 

 

 

Cash and cash equivalents

$

85,572

 

 

$

98,841

 

Marketable investment securities

 

174,116

 

 

 

144,258

 

Accounts receivable, net

 

45,988

 

 

 

38,302

 

Inventory

 

8,013

 

 

 

7,942

 

Prepaid expenses and other current assets

 

6,716

 

 

 

6,292

 

Total current assets

 

320,405

 

 

 

295,635

 

Long-term accounts receivable, net

 

1,125

 

 

 

1,191

 

Property and equipment, net

 

38,638

 

 

 

25,433

 

Operating lease assets

 

11,621

 

 

 

12,306

 

Goodwill and other intangible assets, net

 

112,840

 

 

 

117,335

 

Other assets – long-term

 

2,683

 

 

 

1,440

 

Total assets

$

487,312

 

 

$

453,340

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current Liabilities

 

 

 

Accounts payable

$

9,540

 

 

$

10,268

 

Accrued compensation

 

21,239

 

 

 

28,945

 

Operating lease liabilities

 

1,226

 

 

 

1,137

 

Other accrued and current liabilities

 

7,449

 

 

 

7,317

 

Total current liabilities

 

39,454

 

 

 

47,667

 

Long-term debt

 

10,008

 

 

 

 

Noncurrent operating lease liabilities

 

13,645

 

 

 

14,173

 

Noncurrent finance lease liabilities

 

312

 

 

 

25

 

Deferred tax liability

 

 

 

 

206

 

Total liabilities

 

63,419

 

 

 

62,071

 

Stockholders’ Equity

 

 

 

Common stock

 

28

 

 

 

27

 

Additional paid-in capital

 

636,022

 

 

 

609,477

 

Accumulated deficit

 

(211,985

)

 

 

(218,371

)

Accumulated other comprehensive (loss) income

 

(172

)

 

 

136

 

Total stockholders’ equity

 

423,893

 

 

 

391,269

 

Total liabilities, and stockholders’ equity

$

487,312

 

 

$

453,340

 

 

CASTLE BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands)

 

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

OPERATING ACTIVITIES

 

 

 

Net income (loss)

$

6,386

 

 

$

(47,981

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

Depreciation and amortization

 

6,688

 

 

 

5,932

 

Stock-based compensation expense

 

25,854

 

 

 

26,374

 

Deferred income taxes

 

(1,542

)

 

 

13

 

Accretion of discounts on marketable investment securities

 

(3,422

)

 

 

(2,282

)

Other

 

83

 

 

 

213

 

Change in operating assets and liabilities:

 

 

 

Accounts receivable

 

(7,620

)

 

 

(7,978

)

Prepaid expenses and other current assets

 

(294

)

 

 

158

 

Inventory

 

(71

)

 

 

(2,141

)

Operating lease assets

 

678

 

 

 

(469

)

Other assets

 

143

 

 

 

(80

)

Accounts payable

 

(1,650

)

 

 

3,071

 

Operating lease liabilities

 

(432

)

 

 

958

 

Accrued compensation

 

(7,706

)

 

 

(7,060

)

Other accrued and current liabilities

 

68

 

 

 

2,047

 

Net cash provided by (used in) operating activities

 

17,163

 

 

 

(29,225

)

 

 

 

 

INVESTING ACTIVITIES

 

 

 

Purchases of property and equipment

 

(14,381

)

 

 

(7,373

)

Proceeds from sale of property and equipment

 

7

 

 

 

8

 

Purchases of marketable investment securities

 

(113,194

)

 

 

(86,438

)

Proceeds from maturities of marketable investment securities

 

86,450

 

 

 

95,000

 

Net cash (used in) provided by investing activities

 

(41,118

)

 

 

1,197

 

 

 

 

 

FINANCING ACTIVITIES

 

 

 

Proceeds from exercise of common stock options

 

73

 

 

 

184

 

Payment of employees’ taxes on vested restricted stock units

 

(1,089

)

 

 

(848

)

Proceeds from contributions to the employee stock purchase plan

 

1,749

 

 

 

1,688

 

Repayment of principal portion of finance lease liabilities

 

(47

)

 

 

(70

)

Proceeds from issuance of term debt

 

10,000

 

 

 

 

Net cash provided by financing activities

 

10,686

 

 

 

954

 

 

 

 

 

NET CHANGE IN CASH AND CASH EQUIVALENTS

 

(13,269

)

 

 

(27,074

)

Beginning of period

 

98,841

 

 

 

122,948

 

End of period

$

85,572

 

 

$

95,874

 

CASTLE BIOSCIENCES, INC.

Reconciliation of Non-GAAP Financial Measures (UNAUDITED)

The table below presents the reconciliation of adjusted revenues and adjusted gross margin, which are non-GAAP financial measures. 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

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

(in thousands)

 

 

 

 

 

 

 

Adjusted revenues

 

 

 

 

 

 

 

Net revenues (GAAP)

$

87,002

 

 

$

50,138

 

 

$

159,976

 

 

$

92,175

 

Revenue associated with test reports delivered in prior periods

 

(363

)

 

 

88

 

 

 

(959

)

 

 

1,705

 

Adjusted revenues (Non-GAAP)

$

86,639

 

 

$

50,226

 

 

$

159,017

 

 

$

93,880

 

 

 

 

 

 

 

 

 

Adjusted gross margin

 

 

 

 

 

 

 

Gross margin (GAAP)1

$

70,236

 

 

$

36,832

 

 

$

127,069

 

 

$

66,465

 

Amortization of acquired intangible assets

 

2,247

 

 

 

2,248

 

 

 

4,494

 

 

 

4,470

 

Revenue associated with test reports delivered in prior periods

 

(363

)

 

 

88

 

 

 

(959

)

 

 

1,705

 

Adjusted gross margin (Non-GAAP)

$

72,120

 

 

$

39,168

 

 

$

130,604

 

 

$

72,640

 

 

 

 

 

 

 

 

 

Gross margin percentage (GAAP)2

 

80.7

%

 

 

73.5

%

 

 

79.4

%

 

 

72.1

%

Adjusted gross margin percentage (Non-GAAP)3

 

83.2

%

 

 

78.0

%

 

 

82.1

%

 

 

77.4

%

______________________

1.

Calculated as net revenues (GAAP) less the sum of cost of sales (exclusive of amortization of acquired intangible assets) and amortization of acquired intangible assets.

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).

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

June 30,

 

Six Months Ended

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

(in thousands)

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

Net income (loss)

$

8,920

 

 

$

(18,777

)

 

$

6,386

 

 

$

(47,981

)

Interest income

 

(3,144

)

 

 

(2,399

)

 

 

(6,140

)

 

 

(4,735

)

Interest expense

 

270

 

 

 

3

 

 

 

284

 

 

 

7

 

Income tax (benefit) expense

 

(1,034

)

 

 

16

 

 

 

(989

)

 

 

30

 

Depreciation and amortization expense

 

3,348

 

 

 

3,040

 

 

 

6,688

 

 

 

5,932

 

Stock-based compensation expense

 

13,179

 

 

 

12,849

 

 

 

25,854

 

 

 

26,374

 

Adjusted EBITDA (Non-GAAP)

$

21,539

 

 

$

(5,268

)

 

$

32,083

 

 

$

(20,373

)

 

Investor Relations Contact:

Camilla Zuckero

czuckero@castlebiosciences.com

281-906-3868

Media Contact:

Allison Marshall

amarshall@castlebiosciences.com

Source: Castle Biosciences Inc.

FAQ

What was Castle Biosciences' (CSTL) revenue for Q2 2024?

Castle Biosciences reported revenue of $87 million for Q2 2024, representing a 74% increase compared to Q2 2023.

How many total test reports did Castle Biosciences (CSTL) deliver in Q2 2024?

Castle Biosciences delivered 25,102 total test reports in Q2 2024, a 49% increase compared to 16,820 in Q2 2023.

What is Castle Biosciences' (CSTL) updated revenue guidance for full-year 2024?

Castle Biosciences raised its full-year 2024 revenue guidance to between $275-300 million, up from the previously provided guidance of $255-265 million.

How did Castle Biosciences' (CSTL) net income change in Q2 2024 compared to Q2 2023?

Castle Biosciences reported a net income of $8.9 million in Q2 2024, compared to a net loss of $18.8 million in Q2 2023.

What was Castle Biosciences' (CSTL) cash position as of June 30, 2024?

As of June 30, 2024, Castle Biosciences' cash, cash equivalents and marketable investment securities totaled $259.7 million.

Castle Biosciences, Inc.

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