Castle Biosciences (NASDAQ:CSTL) Posts Earnings Results, Beats Expectations By $0.22 EPS

Castle Biosciences (NASDAQ:CSTL) posted its quarterly earnings results on Thursday. The company reported ($0.13) earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of ($0.35) by $0.22, FiscalAI reports. The business had revenue of $101.95 million during the quarter, compared to analyst estimates of $92.77 million. Castle Biosciences had a negative net margin of 5.43% and a negative return on equity of 4.15%.

Here are the key takeaways from Castle Biosciences’ conference call:

• Revenue guidance increased substantially: Third-quarter revenue rose 24% year over year to $102.9 million, and Castle raised full-year 2026 guidance by $20 million at the midpoint to $385 million–$395 million, citing strong core-business performance, TissueCypher growth and ASP improvement.
• TissueCypher remained the main growth driver: Test reports increased 47% to 15,574, and the company reiterated its 50%–52% full-year volume-growth outlook. Management estimates market penetration at about 15%, while noting that seasonality and sales-team changes can make quarterly growth uneven.
• Cash generation and adjusted profitability strengthened: Adjusted EBITDA was $12.7 million versus $9.2 million a year earlier, and operating cash flow was $19.7 million for the quarter. Castle reported approximately $278 million in cash and investments and expects positive Adjusted EBITDA for 2026 and 2027.
• GAAP loss widened as expenses rose: Net loss increased to $4.1 million from $0.5 million in the year-ago quarter, while operating expenses including cost of sales grew to $105.6 million from $89.8 million, reflecting higher staffing and other costs.
• Medicare coverage remains a headwind for DecisionDx-SCC: Management said its 2027 revenue outlook does not assume a recovery in Medicare coverage, with a draft coverage decision possible in the coming months but no firm timeline provided.

Castle Biosciences Stock Down 4.3%

Castle Biosciences stock traded down $1.55 during mid-day trading on Thursday, hitting $34.20. 701,872 shares of the company’s stock were exchanged, compared to its average volume of 350,710. Castle Biosciences has a 1-year low of $17.72 and a 1-year high of $44.28. The stock has a 50 day moving average of $34.28 and a two-hundred day moving average of $28.57. The company has a current ratio of 6.04, a quick ratio of 5.85 and a debt-to-equity ratio of 0.02. The stock has a market cap of $1.04 billion, a P/E ratio of -51.82 and a beta of 1.00.

Analyst Upgrades and Downgrades

Several research firms have weighed in on CSTL. BTIG Research upped their price objective on shares of Castle Biosciences from $40.00 to $44.00 and gave the company a “buy” rating in a research note on Monday, August 3rd. Wall Street Zen raised shares of Castle Biosciences from a “hold” rating to a “buy” rating in a research note on Sunday. Robert W. Baird set a $36.00 price target on shares of Castle Biosciences in a report on Friday, July 31st. Mizuho started coverage on shares of Castle Biosciences in a report on Thursday, October 29th. They set an “outperform” rating and a $60.00 price target on the stock. Finally, Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Castle Biosciences in a research note on Thursday, October 29th. One analyst has rated the stock with a Strong Buy rating, eight have assigned a Buy rating, one has given a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, Castle Biosciences presently has a consensus rating of “Moderate Buy” and an average target price of $44.25.

Insiders Place Their Bets

In related news, COO Kristen M. Oelschlager sold 4,153 shares of the firm’s stock in a transaction that occurred on Thursday, October 1st. The stock was sold at an average price of $35.95, for a total value of $149,300.35. Following the transaction, the chief operating officer directly owned 13,356 shares of the company’s stock, valued at approximately $480,148.20. This trade represents a 23.72% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Tobin W. Juvenal sold 6,578 shares of the business’s stock in a transaction that occurred on Wednesday, October 28th. The stock was sold at an average price of $36.42, for a total value of $239,570.76. Following the completion of the sale, the insider owned 38,853 shares of the company’s stock, valued at approximately $1,415,026.26. This trade represents a 14.48% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 126,184 shares of company stock valued at $4,324,506 over the last quarter. Insiders own 6.10% of the company’s stock.

Castle Biosciences Company Profile

Castle Biosciences, Inc is a molecular diagnostics company that develops and commercializes tests designed to help physicians diagnose cancer, assess disease risk and guide treatment decisions. The company focuses on conditions in which additional biological information can complement traditional pathology and clinical assessment.

Its portfolio includes DecisionDx-Melanoma, which helps evaluate the risk of metastatic recurrence in patients with cutaneous melanoma; DecisionDx-SCC, which assesses metastatic risk in cutaneous squamous cell carcinoma; and DecisionDx-UM, a test for determining metastatic risk in uveal melanoma.