Castle Biosciences reported total revenue of $340.2 million for the full year 2025, a 2.4% increase over the prior year’s $332.1 million and a beat of the company’s own guidance range of $327–$335 million. The lift was driven by a 37% rise in report volume for its core diagnostics, DecisionDx‑Melanoma and TissueCypher, which together generated 78,097 reports in 2025 versus 56,964 in 2024. The company’s Q4 2025 revenue of $86.3 million matched the year‑end figure, up 42% from $61.8 million in Q4 2024, reflecting a strong acceleration in demand during the final quarter.
The volume growth was concentrated in the core segments: DecisionDx‑Melanoma reports climbed to 39,083 from 36,008, while TissueCypher Barrett’s Esophagus reports surged to 39,014 from 20,956. In Q4, DecisionDx‑Melanoma reports rose to 10,022 from 8,672, and TissueCypher reports jumped to 11,803 from 6,672. The accelerated Q4 performance indicates that the company’s marketing and sales initiatives are gaining traction and that the pipeline for new test launches is beginning to generate early revenue.
At year‑end, Castle’s balance sheet remained robust, with cash and cash equivalents of $116 million and marketable securities of $184 million, totaling $300 million in liquid assets. The strong cash position provides flexibility for continued investment in research, regulatory expansion, and potential acquisitions, while also supporting ongoing product development such as the atopic dermatitis test AdvanceAD‑Tx.
The limited‑access launch of AdvanceAD‑Tx in November 2025 marked the company’s first entry into the atopic dermatitis market, a $33 billion opportunity. The launch was supported by a Medicare coverage change effective April 24 2025, which broadened reimbursement for the test. However, the company also faced headwinds: a Medicare coverage change in April reduced volumes for some legacy tests, and the discontinuation of the IDgenetix test in May 2025 removed a smaller revenue stream from the portfolio. These factors partially offset the gains from the new test launch.
Management highlighted the strong execution across dermatology and gastrointestinal franchises, noting that the accelerated Q4 growth and the AdvanceAD‑Tx launch position the company well for 2026. The company’s gross margin for Q3 2025 was 75%, down from 79% in Q3 2024, and the adjusted gross margin fell to 77% from 82% the previous year, reflecting a mix shift toward lower‑margin tests and modest cost inflation. Despite margin compression, the company’s revenue beat and cash strength suggest that it can sustain its growth trajectory while managing headwinds.
The overall picture is one of a company that has successfully expanded its product portfolio and market reach while maintaining a solid financial foundation. The revenue beat, accelerated Q4 performance, and strategic launch of AdvanceAD‑Tx signal confidence in future growth, even as the company navigates reimbursement changes and portfolio adjustments.
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