Castle Biosciences, Inc. (CSTL): Business Model Canvas [Dec-2025 Updated]

You're digging into Castle Biosciences, Inc.'s operating model, and honestly, the narrative isn't just about their established success in melanoma diagnostics anymore; it's about the strategic expansion into the much larger dermatology and GI spaces. With a solid war chest of about $287.5 million in cash as of Q3 2025 and full-year revenue guidance projected up to $335 million, they clearly have the financial runway to execute this growth. Their entire engine runs on proprietary Gene Expression Profile (GEP) technology, which translates complex biology into clear, personalized risk scores that help clinicians avoid unnecessary procedures and select the right treatment path, like for Barrett's esophagus or atopic dermatitis. Let's break down the nine essential building blocks of the Castle Biosciences, Inc. business model to see exactly how they plan to scale this specialized, high-value testing franchise.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Key Partnerships

You're looking at how Castle Biosciences, Inc. builds value through external relationships, which is critical when you're managing a portfolio of specialized diagnostic tests and navigating the complex world of payer coverage. These partnerships are about extending reach, acquiring technology, and validating clinical utility in real-world settings.

The collaboration and license agreement with SciBase Holding AB, announced in June 2025, is a key move to expand into dermatologic diseases beyond their existing skin cancer tests. The initial focus is developing a test to predict flares in patients diagnosed with atopic dermatitis (AD), a condition potentially affecting up to 24 million patients in the United States. This deal has clear financial hooks: SciBase is set to receive a single-digit royalty percentage on Castle gross margin and a low double-digit percentage mark-up on product sales to Castle. Furthermore, SciBase is eligible for a milestone payment of $5 million when Castle sales hit $50 million annually. To support this, in November 2025, Castle Biosciences entered a separate loan agreement to provide SciBase with SEK 20 million, a five-year loan with an interest rate of STIBOR plus 2% per annum, which Castle can request to convert into new SciBase shares.

Research collaborations provide the necessary real-world evidence to support test adoption. Castle Biosciences maintains an ongoing partnership with the National Cancer Institute's Surveillance, Epidemiology and End Results (SEER) Program Registries. This collaboration has yielded updated validation data for the DecisionDx-Melanoma test. The latest poster presentation in early 2025 included data from a large, unselected real-world cohort of nearly 10,000 patients, building on previous studies by incorporating approximately 4,800 more patients.

To bolster the gastrointestinal test portfolio, Castle Biosciences signed a definitive agreement in May 2025 to acquire Previse (Capsulomics, Inc.), a company focused on chronic acid reflux diseases like esophageal cancer. The specific terms of this strategic tuck-in acquisition were undisclosed. This move integrates Previse's Esopredict® test, which uses methylation technology developed at the Johns Hopkins University School of Medicine, complementing Castle's existing TissueCypher Barrett's Esophagus test.

Securing payment from payers remains a constant component of the business model, though it presents clear risks. A significant event impacting revenue streams was the loss of Medicare reimbursement for the DecisionDx-SCC test, which became effective on April 24, 2025. Despite this, Castle Biosciences raised its full-year 2025 total revenue guidance to a range of $327 million to $335 million as of the third quarter of 2025. For the new AdvanceAD-Tx, reimbursement remains uncertain, with multiple pathways under exploration, and revenue from it is anticipated to be immaterial in 2026.

Here's a quick look at the financial and statistical anchors of these key external relationships:

Partnership/Agreement Type	Partner/Entity	Key Metric/Financial Term	Date/Status Reference
Collaboration & License	SciBase Holding AB	$5 million milestone payment	Upon Castle sales reaching $50 million annually
Loan Agreement	SciBase Holding AB	SEK 20 million loan provided by Castle	November 2025
Research Collaboration	NCI's SEER Program Registries	Validation cohort size of nearly 10,000 patients	Early 2025 data presentation
Strategic Acquisition	Previse (Capsulomics, Inc.)	Acquisition terms	Undisclosed (Agreement signed May 2025)
Payer Coverage	Medicare (for DecisionDx-SCC)	Reimbursement status change	Became noncovered effective April 24, 2025

Finance: draft 13-week cash view by Friday.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Key Activities

You're looking at the core engine driving Castle Biosciences, Inc.'s value creation right now-the things they absolutely must execute on to hit those guidance numbers. It's all about the science translating into billable tests, and that requires constant development, validation, and commercial muscle.

Developing and validating proprietary Gene Expression Profile (GEP) diagnostic tests

Castle Biosciences, Inc. is focused on creating and proving the utility of its GEP tests. The newest addition to the portfolio, AdvanceAD-Tx™, launched its limited access model in November 2025.

The AdvanceAD-Tx™ test itself is a complex piece of work, designed to guide systemic treatment for atopic dermatitis. Here are the technical specs we know:

• - Evaluates expression of 487 genes.
• - Genes span 12 known immune inflammatory and skin-related pathways.
• - Targets a U.S. Total Addressable Market (TAM) estimated at $33 billion.

Securing and defending payer coverage, like the Novitas LCD reconsideration for DecisionDx-SCC

Payer coverage is a constant battleground, especially when established policies change. The Novitas LCD, Genetic Testing in Oncology: Specific Tests, included DecisionDx-SCC as noncovered, effective April 24, 2025.

The impact of this coverage shift was visible in the financials, though the company is actively defending the test's value:

Metric	Period Ended Sept 30, 2025 (9 Months)	Period Ended Sept 30, 2024 (9 Months)
DecisionDx-SCC Test Reports	13,323	12,049
DecisionDx-SCC Revenue	Approximately $15 million (Q2 2025)	N/A

Still, Castle Biosciences, Inc. secured a positive step, as Novitas accepted a reconsideration request for the policy as valid under CMS guidelines during the second quarter of 2025.

Commercializing and scaling the core dermatologic and GI testing franchises

Scaling means moving more tests through the system, and the core franchises are showing strong volume momentum as of the third quarter of 2025. The company raised its full-year 2025 total revenue guidance to a range of $327 million to $335 million.

The growth in the core drivers, DecisionDx-Melanoma and TissueCypher, is what's really moving the needle:

• - Core revenue drivers volume increase (Q3 2025 YoY): 36%.
• - DecisionDx-Melanoma reports (Q3 2025): Surpassed 10,000 reports in a single quarter for the first time.
• - TissueCypher reports (Q3 2025): Surpassed 10,000 reports in a single quarter for the first time.
• - Non-dermatologic revenue growth (Q3 2025 YoY): 67%.

Here's a look at the overall volume and financial scale reported for the nine months ended September 30, 2025:

Financial/Volume Metric	Nine Months Ended Sept 30, 2025	Nine Months Ended Sept 30, 2024
Total Revenue	$257.2 million	$245.8 million
Total Test Reports Delivered	77,817	72,000
Cash, Cash Equivalents, Marketable Securities (as of Sept 30)	$287.5 million	N/A

Conducting extensive clinical studies to generate real-world evidence for test utility

Generating compelling real-world evidence is key to driving adoption and supporting payer negotiations. Castle Biosciences, Inc. continues to present data reinforcing the clinical value of its tests.

For DecisionDx-Melanoma, a large real-world study showed significant patient benefit:

• - Associated with a 32% reduction in mortality risk compared to untested patients.
• - The test has been supported by more than 50 peer-reviewed and published studies.
• - The test surpassed a cumulative milestone of 200,000 orders as of April 2025.

For DecisionDx-SCC, new data presented in 2025 validated a third use case for the test, which is predicting local recurrence in NCC and high-risk SCC patients.

Operating CLIA-certified labs for high-throughput, quality test processing

The operational backbone involves managing laboratory facilities that can handle the growing test volume while maintaining quality standards. Castle Biosciences, Inc. manages its testing through facilities that meet stringent regulatory requirements.

The company operates laboratory facilities in two key locations:

• - Phoenix, Arizona.
• - Pittsburgh, Pennsylvania.

These facilities are all CLIA-certified, CAP-accredited, and hold NY state approval, positioning them to operate across all 50 states.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Key Resources

The Key Resources for Castle Biosciences, Inc. center on its scientific foundation, financial stability, and specialized commercial infrastructure.

The core intellectual property is its proprietary GEP technology (gene expression profile) and the resulting validated, first-in-class diagnostic algorithms. Castle Biosciences currently markets six proprietary tests designed to guide patient care decisions in dermatologic and gastroenterological diseases.

Financially, the company maintained a strong liquidity position as of late 2025. Substantial cash, cash equivalents, and marketable securities totaled approximately $287.5 million as of September 30, 2025. This capital supports ongoing research, development, and commercialization efforts.

The commercial reach relies on a specialized dermatology and gastroenterology commercial sales team, focused on driving adoption of tests like DecisionDx-Melanoma and TissueCypher. The company aims to increase market penetration for DecisionDx-Melanoma to 55-65%.

The extensive portfolio of intellectual property covers these diagnostic tests, which include GEP tests for various cancers and conditions. The obligations under the 2024 Loan and Security Agreement specifically exclude intellectual property from the assets securing the debt.

Here is a breakdown of the key proprietary tests that represent the core of the intellectual and technological resource base:

Proprietary Test Name	Primary Indication/Use	Technology Type	Latest Reported Quarterly Volume (Q3 2025)
DecisionDx-Melanoma	Invasive cutaneous melanoma risk of metastasis/recurrence	GEP	Surpassed 10,000 test reports
TissueCypher	Barrett's Esophagus progression to esophageal cancer	Proprietary Test	Surpassed 10,000 test reports
DecisionDx-SCC	Cutaneous squamous cell carcinoma metastasis risk	GEP	Part of 26,841 total test reports
DecisionDx-UM	Uveal melanoma staging and metastasis risk	GEP	Part of 26,841 total test reports
MyPath Melanoma	Characterizing difficult-to-diagnose melanocytic lesions	Diagnostic GEP	Part of 26,841 total test reports
AdvanceAD-Tx™	Systemic treatment decision making in atopic dermatitis	487-GEP	Recently launched

The company's operational footprint, which supports these resources, includes corporate headquarters in Friendswood, Texas, and laboratory facilities located in Phoenix, Arizona, and Pittsburgh, Pennsylvania.

The utilization of these resources is reflected in the test volume metrics:

• Total test reports delivered in Q3 2025: 26,841.
• Total test reports delivered in Q3 2024: 26,010.
• DecisionDx-Melanoma test orders surpassed 200,000 as of March 2025.

The company's ability to generate cash from operations was $22.6 million in Q3 2025.

Finance: review the IP valuation against the secured debt exclusion by next Tuesday.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Value Propositions

You're looking at the core value Castle Biosciences, Inc. (CSTL) delivers across its diagnostic portfolio as of late 2025. This isn't just about running tests; it's about providing actionable, data-driven clarity where clinical uncertainty is high. The numbers show real traction in adoption and clinical utility.

Providing personalized, risk-aligned management decisions for cutaneous melanoma (DecisionDx-Melanoma)

DecisionDx-Melanoma is the cornerstone, helping clinicians move past traditional staging. The test has achieved significant adoption, surpassing 200,000 total test orders by May 2025. In the third quarter of 2025 alone, the volume hit a milestone, exceeding 10,000 test reports for the first time in a single quarter. For the first nine months of 2025, reports totaled 29,061. The value is in the risk stratification, which has been associated with improved survival; real-world data suggests patients receiving the test saw a 29% lower 3-year melanoma-specific mortality compared to those who did not.

Here's a look at the prognostic power this test offers across different melanoma types:

Risk Group (Nodular Melanoma)	5-Year Melanoma-Specific Survival (MSS)
Class 1A (Lowest Risk)	98.5%
Class 2B (Highest Risk)	82.3%

This level of precision helps define patient pathways clearly. Furthermore, overall real-world evidence, like the NCI SEER study, points to a 32% reduction in melanoma mortality in patients utilizing the test.

Improving prognostic accuracy and reducing unnecessary procedures, like Sentinel Lymph Node Biopsy (SLNB)

The ability to accurately identify low-risk patients directly translates into avoiding invasive procedures. For patients classified as low risk by DecisionDx-Melanoma, the rate of Sentinel Lymph Node (SLN) positivity was only 2.8%. This figure is a key metric because it is significantly better than the 5% threshold set by the NCCN guidelines for ruling out the need for an SLNB. You're seeing a direct mechanism for reducing patient morbidity by providing objective data that supports a less aggressive initial management plan.

Guiding systemic treatment selection for moderate-to-severe atopic dermatitis (AdvanceAD-Tx)

Castle Biosciences, Inc. launched AdvanceAD-Tx on November 3, 2025, targeting the $33 billion U.S. Total Addressable Market for moderate-to-severe atopic dermatitis (AD). This 487-gene expression profile test is designed to tell clinicians which patients will respond best to a JAK inhibitor versus a Th2 therapy. The initial commercial rollout started with a measured, limited-access model in November 2025, with revenue contribution expected to be immaterial in 2026 as reimbursement is established.

The validation data shows a clear benefit for the identified responder group:

• 30.4% of tested samples showed a JAK inhibitor responder profile.
• EASI-90 response by three months was 45.5% for JAKi vs. 8.3% for Th2 therapies (p=0.021).
• Flare-free rates at three months were 54.5% on JAKi vs. 16.7%.
• vIGA-AD clear rates reached 36.4% with JAKi vs. 0% for the alternative (p=0.006).

Offering risk stratification for progression in Barrett's esophagus (TissueCypher)

TissueCypher provides personalized risk stratification for patients with Barrett's esophagus (BE), predicting progression to high-grade dysplasia or esophageal cancer. This is critical given that esophageal cancer carries a five-year survival rate of just 22%. The test is gaining traction, with 10,609 reports delivered in Q3 2025, marking 75% year-on-year growth for the product. Cumulative reports surpassed 25,000 since the end of 2021. The test has achieved Advanced Diagnostic Laboratory Test status from CMS.

The core value proposition here is moving beyond standard pathology to reveal high-risk patients who might otherwise be overlooked, enabling personalized surveillance or intervention strategies.

• Nine months ended September 30, 2025, TissueCypher reports: 27,211.
• Q3 2025 total test reports for core drivers (including DecisionDx-Melanoma) increased 36% year-over-year.

Overall, the company raised its full-year 2025 revenue guidance to a range of $327 million to $335 million based on this momentum.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Customer Relationships

You're looking at how Castle Biosciences, Inc. (CSTL) keeps its clinical customers engaged, which is key since their value proposition is built on complex molecular data guiding critical decisions. The relationship is definitely high-touch, relying heavily on education and support to ensure the test results translate into actual practice changes for melanoma management.

The depth of this relationship is grounded in evidence. Castle Biosciences, Inc. (CSTL) builds its credibility on a substantial body of work supporting DecisionDx-Melanoma. This evidence base includes over 50 peer-reviewed publications, including prospective studies and meta-analyses. Furthermore, the test was developed in collaboration with more than 100 leading U.S. institutions.

The adoption rate shows how well this educational engagement is working. By the third quarter of 2025, DecisionDx-Melanoma had been ordered more than 220,000 times since its launch. This level of use requires significant ongoing clinical support and consultation for interpreting physicians to properly integrate the molecular insights with clinicopathologic factors.

Here's a quick look at the scale of adoption for core products through the first nine months of 2025:

Metric	Nine Months Ended Sept. 30, 2025	Comparison Period (Nine Months Ended Sept. 30, 2024)
DecisionDx-Melanoma Test Reports Delivered	29,061	27,336
Total Test Reports (Core Drivers)	77,817	72,000
Q3 2025 Total Test Reports (Core Drivers)	26,841	26,010 (Q3 2024)

The company achieved a significant internal milestone in Q3 2025, with DecisionDx-Melanoma test reports surpassing 10,000 in a single quarter for the first time. This growth trajectory supports the expectation of high single-digit volume growth for DecisionDx-Melanoma for the full year 2025.

Managing the customer relationship also means handling the financial side for the patient. This involves managing patient billing and complex reimbursement processes defintely. While the company raised its full-year 2025 revenue guidance to a range of $327 million to $335 million, reflecting confidence in adoption, ongoing reimbursement initiatives for existing and new tests remain a key operational focus area for sustaining this customer base.

The clinical support structure is reinforced by:

• Clinical validation in more than 10,000 patient samples for DecisionDx-Melanoma.
• The test has been shown to be associated with improved patient survival.
• The company is pursuing multiple reimbursement pathways to drive adoption for newer tests like AdvanceAD-Tx.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Channels

You're looking at how Castle Biosciences, Inc. (CSTL) gets its diagnostic insights from the lab bench to the ordering physician, and then disseminates the supporting science. It's a complex flow, especially when you're dealing with specialized oncology and GI tests.

The primary route to market relies on direct engagement with specialists. While the exact headcount of the commercial team isn't public, we can see the investment behind this channel. Sales and marketing expenses for the third quarter of 2025 reached $32.8 million. This spend supports the team targeting dermatologists, oncologists, and gastroenterologists, as they push core products like DecisionDx-Melanoma and the newer AdvanceAD-Tx™, which leverages the existing dermatology commercial team for its phased launch.

The physical engine of this channel is the laboratory network. Castle Biosciences operates its CLIA-certified central laboratory facilities in Phoenix, Arizona and Pittsburgh, Pennsylvania. This lab processes the tissue samples sent in from physicians across the country. The volume flowing through this channel is substantial; for the nine months ended September 30, 2025, Castle Biosciences delivered 77,817 total test reports. To give you a sense of the recent pace, the third quarter of 2025 alone saw 26,841 total test reports delivered.

Delivering those results back to the ordering physician is a critical step in the channel. This happens via secure online portals and printed reports. The output volume is tracked closely: in Q3 2025, the core tests, DecisionDx-Melanoma and TissueCypher, each surpassed 10,000 test reports for the first time in a single quarter. The DecisionDx-Melanoma test, a major driver, has now surpassed 200,000 total test orders since its launch.

Disseminating the clinical validation is a channel unto itself, building the credibility that drives the sales force. Castle Biosciences actively participates in scientific conferences and publishes in peer-reviewed journals. For instance, the company held its Q3 2025 Earnings Call on November 3, 2025, and had an upcoming presentation scheduled for the Piper Sandler 37th Annual Healthcare Conference on December 02, 2025.

Here's a quick look at the volume metrics that these channels supported through the first nine months of 2025:

Metric	Value (9 Months Ended Sept 30, 2025)	Comparison Period
Total Test Reports Delivered	77,817	vs. 72,000 in the same period of 2024
DecisionDx-Melanoma Test Reports	29,061	vs. 27,336 for the same period in 2024
DecisionDx-SCC Test Reports	13,323	vs. 12,049 for the same period in 2024
MyPath Melanoma Test Reports	3,243	vs. 3,030 for the same period in 2024
DecisionDx-UM Test Reports	1,374	vs. 1,275 for the same period in 2024

The company is clearly pushing adoption across its portfolio, even while discontinuing the IDgenetix test in May 2025.

The key channels Castle Biosciences uses to reach and inform its customers include:

• - Direct sales force targeting dermatologists, oncologists, and gastroenterologists.
• - CLIA-certified central laboratory for receiving and processing tissue samples.
• - Secure online portals and printed reports for delivering test results to physicians.
• - Scientific conferences and peer-reviewed journals for disseminating clinical data.

The overall financial goal supported by these channels is the raised full-year 2025 total revenue guidance, now projected between $327 million to $335 million.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Customer Segments

You're looking at the core groups Castle Biosciences, Inc. (CSTL) serves with its diagnostic tests as of late 2025. These segments drive the business, which saw its full-year 2025 revenue guidance raised to between $327 million and $335 million based on strong execution through the third quarter.

The primary focus remains on specialists dealing with high-risk skin conditions. Dermatologists and Mohs surgeons are the key users for tests like DecisionDx-Melanoma and DecisionDx-SCC. The momentum here is clear; in the third quarter of 2025, DecisionDx-Melanoma alone surpassed 10,000 test reports for the first time in a single quarter, a significant adoption milestone. Management confirmed expectations for high single-digit volume growth for DecisionDx-Melanoma for the full year 2025 compared to 2024.

Next, you have gastroenterologists managing patients with Barrett's esophagus (BE). This group relies on the TissueCypher® Barrett's Esophagus test to predict the future development of high-grade dysplasia and/or esophageal cancer. This segment is part of the gastrointestinal testing franchise showing strength; TissueCypher also surpassed 10,000 test reports in the third quarter of 2025. For context, TissueCypher test reports delivered in the fourth quarter of 2024 were 6,672, showing substantial growth into 2025.

Oncologists and other specialists treating uveal melanoma and high-risk skin cancer are served by tests like DecisionDx-UM. While the volume data for uveal melanoma is less frequently highlighted in the latest summaries, the overall non-dermatologic revenue stream, which includes BE and UM, grew by 67% over the third quarter of 2024, showing rapid expansion in these areas.

A newer, emerging segment involves patients with moderate-to-severe atopic dermatitis (AD) considering systemic therapy. Castle Biosciences, Inc. launched its test, AdvanceAD-Tx™, in November 2025 to guide these treatment decisions. This test targets what the company described as a $33 billion total addressable market opportunity in the U.S. alone, though management expects its revenue contribution to be immaterial in 2026 as reimbursement pathways develop. The company is leveraging its existing dermatology commercial team for this launch.

Here's a quick look at the volume performance driving revenue from these core physician groups in Q3 2025:

Customer Focus Area	Key Test(s)	Q3 2025 Test Reports Delivered	Year-over-Year Volume Change (Core Drivers)
Cutaneous Melanoma Risk	DecisionDx-Melanoma	Over 10,000 (Milestone)	36% increase for core drivers vs Q3 2024
Barrett's Esophagus Progression	TissueCypher®	Over 10,000 (Milestone)	36% increase for core drivers vs Q3 2024
General Skin Cancer/Other	Total Test Reports	26,841	Total Q3 2025 Volume vs Q3 2024: 26,841 vs 26,010

The overall customer base is being addressed by a portfolio that generated $83.0 million in revenue for the third quarter of 2025.

You can see how the segments map to the company's recent operational metrics:

• - Dermatologists/Mohs surgeons: Drive DecisionDx-Melanoma volume, which surpassed 200,000 total orders since launch as of Q1 2025.
• - Gastroenterologists: Drive TissueCypher volume, which saw 7,432 reports in Q1 2025, a 117% year-over-year increase.
• - Oncologists/Specialists (Uveal Melanoma/High-Risk): Contribute to the non-dermatologic revenue stream that grew 67% in Q3 2025 over Q3 2024.
• - Patients with AD: Targeted by the newly launched AdvanceAD-Tx, aiming at a $33 billion U.S. market.

Finance: draft 13-week cash view by Friday.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Cost Structure

You're looking at the core expenses driving Castle Biosciences, Inc.'s operations as of late 2025. These costs reflect the heavy lift required to commercialize specialized diagnostic tests and build out the pipeline.

High sales and marketing expenses to drive test adoption are a major component. For the third quarter of 2025, Castle Biosciences reported Sales and marketing expenses of $32.8 million, up from $29.8 million in the third quarter of 2024. This spending fuels the adoption of tests like DecisionDx-Melanoma and TissueCypher, which saw total test report volume increase by 36% over Q3 2024. The total Selling, general and administrative expense for Q3 2025 was even higher at $55,907 thousand.

The company maintains significant R&D investment for pipeline development and clinical validation. Research and development expenses for the three months ended September 30, 2025, totaled $12,960 thousand. For the first nine months of 2025, R&D spending reached $38,335 thousand. This investment supports programs like the AdvanceAD-Tx test, which targets a $33 billion addressable market in atopic dermatitis.

Cost of sales, including lab operations and personnel, is another key area. For the third quarter of 2025, Cost of sales (exclusive of amortization of acquired intangible assets) was $18,704 thousand. Over the first nine months of 2025, this cost category amounted to $52,713 thousand. The company noted that a significant portion of this expense represents fixed costs associated with testing operations, including personnel and lab services.

Finally, Amortization of acquired intangible assets creates a non-cash drag on reported net income. For the first quarter of 2025, Amortization of acquired intangible assets was reported as $28.3 million. This specific quarter was impacted by a one-time acceleration of amortization expense related to the discontinuation of the IDgenetix test, totaling approximately $20.1 million for that period.

Here's a look at the operating expense breakdown for the latest reported quarter, Q3 2025, alongside the specific figures mentioned:

Expense Category	Period	Amount (in thousands or as specified)	Source Context
Sales and Marketing Expense	Q3 2025	$32,800 thousand (or $32.8 million)	Driving test adoption
Total SG&A Expense	Q3 2025	$55,907 thousand	Total Selling, general and administrative
Research and Development	Q3 2025	$12,960 thousand	Pipeline investment
Cost of Sales (excl. Amort.)	Q3 2025	$18,704 thousand	Lab operations and personnel
Amortization of Acquired Intangible Assets	Q1 2025	$28.3 million	Impact on net income

The total operating expenses, including cost of sales, for Q3 2025 were $89.8 million, up from $80.7 million in Q3 2024.

You should review the relationship between the high Sales and Marketing spend and the growth in core test reports, which was 36% year-over-year in Q3 2025. Finance: draft 13-week cash view by Friday.

Castle Biosciences, Inc. (CSTL) - Canvas Business Model: Revenue Streams

You're looking at the engine driving Castle Biosciences, Inc.'s current financial picture, which is heavily reliant on test volume and payer coverage. The company has a clear, upward revision to its financial expectations for the year, reflecting strong execution in its core franchises. Castle Biosciences raised its full-year 2025 total revenue guidance to a range of \$327 million to \$335 million, up from the prior projection of \$310 million to \$320 million. This confidence stems from a solid third quarter, where net revenues hit \$83 million.

The revenue streams are clearly anchored by established molecular diagnostics, but diversification is picking up pace. Honestly, the growth in non-dermatologic tests is a key story here, showing the strategy is working, even if reimbursement remains a hurdle for newer offerings. Here's a quick look at how the key revenue drivers performed in Q3 2025:

Revenue Driver Component	Q3 2025 Test Reports	Year-over-Year Volume Growth
DecisionDx-Melanoma	Surpassed 10,000	Reacceleration to 12% (Q3)
TissueCypher	10,609	Reported 75% year-on-year growth (Q3)
Core Drivers (Melanoma + TissueCypher)	26,841 Total Reports	36% increase over Q3 2024
Non-Dermatologic Revenue	N/A	Increased 67% over Q3 2024

The established tests are definitely carrying the load right now. DecisionDx-Melanoma, which predicts lymph node involvement and recurrence risk, saw its growth reaccelerate to 12% in the third quarter. TissueCypher, which addresses Barrett's esophagus, delivered 10,609 test reports in that same period. When you combine these two core revenue drivers, the total test report volume grew 36% year-over-year for the quarter. This momentum is what pushed management to raise that full-year guidance by about \$16 million.

You can't talk about revenue without talking about who pays the bill. Reimbursement from commercial payers and government programs like Medicare/Medicaid is critical for realizing the value of these tests. While the company is pushing for broader adoption, they are actively managing payer dynamics. For instance, efforts to secure reconsideration requests for DecisionDx-SCC by Medicare contractors have been validated, which is a positive development. However, the DecisionDx-SCC test faced a material risk due to a Novitas Local Coverage Determination (LCD) signifying noncoverage by Medicare, which became effective on April 24, 2025. To enhance future reimbursement opportunities for the flagship melanoma test, Castle Biosciences is preparing an FDA submission for DecisionDx-Melanoma.

Diversification is a clear goal, and the numbers show it's happening, albeit from a smaller base. Revenue from non-dermatologic tests grew a substantial 67% year-over-year in Q3 2025. This segment includes the newly launched AdvanceAD-Tx, which targets a massive \$33 billion total addressable market in the U.S. alone. To be fair, the immediate revenue impact from this new test is expected to be minimal, as management projects the contribution from AdvanceAD-Tx to be immaterial in 2026 while they work through the necessary reimbursement pathways. Still, the growth in the existing non-dermatologic portfolio, like TissueCypher, is helping balance the revenue base.