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Jun 30, 2020
Castle Biosciences Q2 2020 Earnings Report
Announced second quarter 2020 results, reflecting COVID-19 impacts but showing improvement in DecisionDx-Melanoma orders since April.
Key Takeaways
Castle Biosciences reported Q2 2020 revenues of $12.7 million, an 18% increase compared to Q2 2019. The company delivered 3,008 DecisionDx-Melanoma test reports, a 19% decrease year-over-year, and maintained a strong gross margin of 83%. Operating cash flow was positive at $13.5 million.
Revenue increased by 18% to $12.7 million compared to Q2 2019.
DecisionDx-Melanoma test report volume decreased by 19% compared to Q2 2019, but saw sequential gains throughout the quarter.
Gross margin remained strong at 83%.
Operating cash flow was positive, reaching $13.5 million.
Forward Guidance
Castle Biosciences is moving forward with its planned commercial team expansion in the second half of 2020 and plans for DecisionDx-SCC to be commercially available at the beginning of September. They also expect a test for suspicious pigmented lesions to become commercially available in the second half of 2020.
Positive Outlook
- Continued progress of pipeline tests allows expansion of services for patients with early-stage skin cancers.
- Planned commercial team expansion in the second half of 2020 to position for near- and long-term growth.
- DecisionDx-SCC is expected to be commercially available at the beginning of September.
- Clinical validation work completed for a pipeline test for use in suspicious pigmented lesions, expected to launch in the second half of 2020.
- Three skin cancer products (DecisionDx-Melanoma, DecisionDx-SCC, and the test for suspicious pigmented lesions) will have a total addressable U.S. market of approximately $2.0 billion.
Challenges Ahead
- COVID-19 pandemic's impact on the Company’s future test report volumes, operating results, cash flows, results of operations and/or financial condition will be primarily driven by such variables as the pandemic's severity, duration and the impact of state and local government restrictions on the U.S. healthcare system, which the Company is unable to predict or control.
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