Castle Biosciences (NASDAQ:CSTL) Releases Quarterly Earnings Results, Beats Expectations By $0.37 EPS

Castle Biosciences (NASDAQ:CSTL) announced its earnings results on Thursday. The company reported ($0.07) EPS for the quarter, topping the consensus estimate of ($0.44) by $0.37, FiscalAI reports. Castle Biosciences had a negative net margin of 3.78% and a negative return on equity of 2.77%. The business had revenue of $99.86 million during the quarter, compared to the consensus estimate of $86.24 million.

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

• Revenue guidance was raised: Second-quarter revenue reached $103.5 million, up 20% year over year, prompting Castle to increase its 2026 revenue outlook to $365 million–$375 million from $345 million–$355 million.
• TissueCypher remained the primary growth engine: Test reports rose 63% year over year to 14,988, and management now expects full-year volume growth of approximately 50%–52%; the company cited continued physician adoption and substantial remaining market opportunity.
• AdvanceAD-Tx commercialization advanced: The test generated more than 1,000 orders in the quarter, received a unanimous recommendation for a $36.75 CMS crosswalk rate, and showed strong real-world treatment-concordance results, supporting a broader commercial launch over time.
• Profitability was pressured by investment spending: Gross margin declined to 74.9% from 77.3%, while the company posted a $2.1 million net loss versus $4.5 million of net income a year earlier, reflecting higher laboratory, personnel, sales, marketing, and R&D costs.
• Melanoma growth remained steady but moderated: DecisionDx-Melanoma report volume increased 3% year over year, below typical seasonal sequential growth, as the sales force adapted to promoting three products; management nevertheless maintained its expectation for mid- to high-single-digit full-year volume growth.

Castle Biosciences Price Performance

NASDAQ:CSTL traded up $2.33 during trading hours on Thursday, reaching $26.79. 690,216 shares of the company were exchanged, compared to its average volume of 390,150. The company has a market capitalization of $812.54 million, a P/E ratio of -60.89 and a beta of 1.00. Castle Biosciences has a 1-year low of $14.59 and a 1-year high of $44.28. The company has a debt-to-equity ratio of 0.02, a current ratio of 6.75 and a quick ratio of 6.53. The business has a 50 day moving average of $22.61 and a 200 day moving average of $26.51.

Insider Buying and Selling at Castle Biosciences

In related news, COO Kristen M. Oelschlager sold 8,587 shares of the business’s stock in a transaction dated Tuesday, June 16th. The stock was sold at an average price of $20.71, for a total value of $177,836.77. Following the completion of the transaction, the chief operating officer owned 30,460 shares of the company’s stock, valued at $630,826.60. The trade was a 21.99% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Derek J. Maetzold sold 6,214 shares of the company’s stock in a transaction dated Thursday, May 7th. The stock was sold at an average price of $22.15, for a total transaction of $137,640.10. Following the sale, the insider directly owned 21,479 shares of the company’s stock, valued at $475,759.85. This represents a 22.44% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 55,025 shares of company stock valued at $1,252,199 over the last ninety days. Insiders own 6.10% of the company’s stock.

Hedge Funds Weigh In On Castle Biosciences

Hedge funds and other institutional investors have recently made changes to their positions in the company. Federated Hermes Inc. bought a new stake in shares of Castle Biosciences during the 4th quarter worth approximately $26,000. Kemnay Advisory Services Inc. bought a new position in Castle Biosciences in the fourth quarter valued at approximately $35,000. Jones Financial Companies Lllp increased its stake in Castle Biosciences by 10,592.0% in the first quarter. Jones Financial Companies Lllp now owns 2,673 shares of the company’s stock valued at $54,000 after acquiring an additional 2,648 shares during the last quarter. Tower Research Capital LLC TRC raised its position in Castle Biosciences by 256.9% during the second quarter. Tower Research Capital LLC TRC now owns 2,791 shares of the company’s stock valued at $57,000 after purchasing an additional 2,009 shares in the last quarter. Finally, Russell Investments Group Ltd. raised its position in Castle Biosciences by 63.7% during the third quarter. Russell Investments Group Ltd. now owns 2,508 shares of the company’s stock valued at $57,000 after purchasing an additional 976 shares in the last quarter. 92.60% of the stock is currently owned by institutional investors and hedge funds.

Analysts Set New Price Targets

Several analysts recently weighed in on the company. Roth Capital began coverage on Castle Biosciences in a report on Wednesday, June 24th. They set a “buy” rating and a $40.00 price target for the company. Zacks Research cut Castle Biosciences from a “strong-buy” rating to a “hold” rating in a research report on Tuesday, May 26th. Canaccord Genuity Group dropped their target price on Castle Biosciences from $50.00 to $40.00 and set a “buy” rating for the company in a report on Monday, April 20th. Robert W. Baird reduced their target price on shares of Castle Biosciences from $44.00 to $43.00 and set an “outperform” rating for the company in a research report on Thursday, May 7th. Finally, BTIG Research decreased their price target on shares of Castle Biosciences from $50.00 to $40.00 and set a “buy” rating on the stock in a research note on Wednesday, May 13th. One research analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat.com, the company presently has a consensus rating of “Moderate Buy” and an average price target of $42.43.

Castle Biosciences Company Profile

Castle Biosciences, Inc is a molecular diagnostics company specializing in the development and commercialization of prognostic and diagnostic tests for patients with dermatologic conditions. The company’s proprietary portfolio of genomic assays is designed to improve risk assessment and guide clinical decision-making for individuals with skin cancers and other skin-related diseases. By combining genomic data with advanced statistical algorithms, Castle Biosciences seeks to provide actionable insights that help physicians tailor treatment plans and monitoring strategies.

The company’s flagship test, DecisionDx-Melanoma, evaluates the probability of metastasis in patients diagnosed with cutaneous melanoma, supporting more personalized surveillance and therapeutic approaches.