Company: CSTL
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0001628280-25-048254
Chunk: 52

Company: CASTLE BIOSCIENCES INC
Filing Date: 2025-11-03
Form: 10-Q
Item: Item 1
Chunk 52
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 revised estimates of pre-tax income, reflecting uncertainty regarding continued Medicare coverage for our DecisionDx-SCC test and updated financial information, as well as stock-based compensation, permanent differences, changes in valuation allowance, research and development tax credit and state income taxes in the prior period. The prior-year period reflected a net income position compared to a net loss position in the current period. No comparable event occurred in the current period. 

Stock-Based Compensation Expense

Stock-based compensation expense, which is allocated among cost of sales, R&D expense and SG&A expense totaled $12.1 million and $13.0 million for the three months ended September 30, 2025 and 2024, respectively. We expect stock-based compensation expense will continue to be material in future periods, attributable to both existing awards outstanding and anticipated additional grants to our current and future employees. As of September 30, 2025, we had 823 employees, compared to 710 as of September 30, 2024. As of September 30, 2025, the total unrecognized stock-based compensation cost related to outstanding awards was $69.6 million, which is expected to be recognized over a weighted-average period of 2.3 years.

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Comparison of the Nine Months Ended September 30, 2025 and 2024

The following table summarizes our results of operations for the periods indicated (in thousands, except percentages):

 Nine Months EndedSeptember 30,Change 20252024(unaudited)NET REVENUES$257,219 $245,758 $11,461 4.7 %OPERATING EXPENSESCost of sales (exclusive of amortization of acquired intangible assets)52,713 44,022 8,691 19.7 %Research and development38,335 40,268 (1,933)(4.8)%Selling, general and administrative172,592 150,082 22,510 15.0 %Amortization of acquired intangible assets32,562 6,766 25,796 381.3 %Total operating expenses, net296,202 241,138 55,064 22.8 %Operating (loss) income(38,983)4,620 (43,603)(943.8)%Interest income8,876 9,544 (668)(7.0)%Changes in fair value of equity securities3,321 — 3,321