$385–395 million: Castle Biosciences raises 2026 revenue outlook after 23.9% quarterly growth
Key Facts
Castle Biosciences raised its 2026 revenue outlook to $385–395 million, from a previous range of $365–375 million, after reporting third-quarter results and results for the nine months ended September 30. The company said in a statement issued on November 5 that third-quarter revenue was $102.891 million, up 23.9% from $83.043 million in the same period of 2025. It maintained its outlook for positive adjusted earnings before interest, taxes, depreciation and amortization in the fourth quarter and in 2026 and 2027. Chief Executive Derek Maetzold said TissueCypher was "a major contributor to revenue performance," with report volume up 47% year over year. The outlook increase follows quarterly revenue growth and an expansion in total reports for the company's two core tests.
Total reports for DecisionDx-Melanoma and TissueCypher rose 22% in the third quarter compared with the same period of 2025. TissueCypher reports totaled 15,574, versus 10,609 a year earlier, while DecisionDx-Melanoma reports fell to 10,177 from 10,459. The divergence shows that the increase in TissueCypher reports accompanied a limited decline in melanoma test reports. TissueCypher aims to predict the risk that Barrett’s esophagus will progress to high-grade dysplasia or esophageal adenocarcinoma within five years. Maetzold described report-volume growth as a major contribution to revenue performance, without the statement specifying a detailed reason for the increase in report volume.
Quarterly revenue growth came alongside a steady gross margin of 75% and adjusted gross margin of 77%, the same levels recorded in the corresponding period of 2025. Revenue from non-dermatologic tests was $55.0 million, compared with $34.5 million a year earlier. By contrast, revenue from dermatologic tests fell to $47.9 million from $48.5 million. DecisionDx-SCC reports also declined to 3,882 from 4,186, and MyPath Melanoma reports fell to 798 from 1,151. These figures show differing trends in revenue and reports across non-dermatologic and dermatologic businesses during the quarter.
On profitability, the company reported a net loss of $4.1 million in the third quarter, compared with $501 thousand in the corresponding period of 2025. Loss per share was $0.13, compared with $0.02 a year earlier. For the nine months ended September 30, adjusted earnings before interest, taxes, depreciation and amortization were $20.0 million, compared with $32.5 million in the same period of 2025. Net cash provided by operating activities was $19.7 million in the third quarter, compared with $22.6 million a year earlier. Total cash, cash equivalents and marketable investment securities stood at $277.7 million on September 30, 2026.
For the nine-month period, revenue was $290.116 million, compared with $257.219 million in the corresponding period of 2025. The company had raised its 2026 revenue outlook in July to $365–375 million from $345–355 million, after reports for its two core tests increased 32% year over year in the second quarter. The latest update marks a second increase to the annual outlook since the start of the year, while the company maintained its outlook for positive adjusted earnings in the fourth quarter and in 2026 and 2027. The company said it would participate in one-on-one meetings during the Jefferies Healthcare Conference from November 16 to 19. It also scheduled a presentation at the Stephens Annual Investment Conference on November 18 at 12:30 p.m. Central time.