Liquidity is under pressure as evidenced by a $34.6 million free cash flow deficit in 2026Q1, driven by high capital expenditures of $12.5 million.
| Cash from Operations | 48.25M | 64.35M | 64.87M | -5.63M | -41.66M | -18.98M | 9.87M | 7.01M | -12.29M | -12.23M |
| Operating CF Margin % | - | 18.69% | 19.53% | -2.56% | -30.4% | -20.18% | 15.75% | 13.53% | -53.96% | -88.95% |
| Operating CF Growth % | -272.35% | -0.8% | 1252.97% | 86.49% | -119.43% | -292.43% | 40.63% | 157.06% | -0.5% | - |
| Net Income | -12.83M | -24.16M | 18.25M | -57.47M | -67.14M | -31.29M | -10.28M | 5.28M | -6.37M | -12.37M |
| Depreciation & Amortization | 14.94M | 40.77M | 16M | 12.33M | 10.54M | 3.41M | 472K | 358K | 323.02K | 310.82K |
| Stock-Based Compensation | 34.71M | 45.89M | 50.32M | 51.22M | 36.32M | 21.74M | 8.31M | 1.25M | 293.64K | 108.7K |
| Deferred Taxes | -5.47M | -6.23M | 1.4M | -223K | -1.88M | -8.74M | 0 | -2.28M | 272.42K | -163.29K |
| Other Non-Cash Items | 2.28M | -5.53M | -6.97M | -4.86M | -19.5M | 0 | 2.22M | 2.37M | 542.37K | 520.23K |
| Working Capital Changes | 14.62M | 13.6M | -14.13M | -6.63M | -7K | -4.1M | 9.15M | 44K | -7.36M | -640.51K |
| Change in Receivables | 13.17M | 6.88M | -12.64M | -14.93M | -6.22M | -4.63M | 1.66M | -896K | -8.41M | -428.21K |
| Change in Inventory | -3.63M | -2.14M | -193K | -3.96M | -1.68M | 327K | -980K | -355K | -577.66K | -115.56K |
| Change in Payables | 5.66M | 3.08M | -4.37M | 5.71M | 582K | -182K | 169K | 557K | 197.25K | 370.9K |
| Cash from Investing | -63.74M | -60.37M | -50.14M | -16.18M | -166.54M | -66.66M | -4.75M | -937K | -277.04K | -494.85K |
| Capital Expenditures | -43.74M | -36.02M | -28.33M | -13.62M | -5.63M | -3.48M | -4.75M | -937K | -277.04K | -494.85K |
| CapEx % of Revenue | 12.87% | 10.46% | 8.53% | 6.2% | 4.11% | 3.7% | 7.58% | 1.81% | 1.22% | 3.6% |
| Acquisitions | -18.7M | -18.73M | 18K | 0 | -26.97M | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -2.1M | -7.64M | 0 | 13K | 742K | -63.17M | 3K | 0 | 0 | 0 |
| Cash from Financing | -10.44M | -6.96M | 6.14M | -2.3M | 1.51M | 5.42M | 305.89M | 88.29M | 15.84M | 8.87M |
| Debt Issued (Net) | -139K | -115K | 9.9M | -142K | -122K | -8K | -27.36M | 20.92M | 5.42M | 8.57M |
| Equity Issued (Net) | 2.51M | 2.21M | 2.02M | 0 | 0 | 0 | 330.04M | 65.98M | 10.42M | 289.16K |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -12.81M | -9.05M | -5.78M | -2.16M | 1.64M | 5.43M | 3.21M | 1.39M | 0 | 3.55K |
| Net Change in Cash | -25.93M | -2.98M | 20.87M | -24.11M | -206.69M | -80.22M | 311.01M | 94.37M | 3.27M | -3.86M |
| Free Cash Flow | 4.52M | 28.33M | 36.54M | -19.25M | -47.29M | -22.47M | 5.11M | 6.08M | -12.57M | -12.73M |
| FCF Margin % | 1.33% | 8.23% | 11% | -8.76% | -34.51% | -23.88% | 8.16% | 11.72% | -55.17% | -92.54% |
| FCF Growth % | -89.18% | -22.48% | 289.85% | 59.3% | -110.48% | -539.3% | -15.86% | 148.35% | 1.23% | - |
| FCF per Share | 0.15 | 0.98 | 1.25 | -0.72 | -1.81 | -0.89 | 0.27 | 0.70 | -1.18 | -1.30 |
| FCF Conversion (FCF/Net Income) | -0.35x | -2.66x | 3.56x | 0.10x | 0.62x | 0.61x | -0.96x | 1.33x | 1.93x | 0.99x |
| Interest Paid | 0 | 0 | 434K | 11K | 16K | 1K | 1.98M | 2.21M | 1.64M | 0 |
| Taxes Paid | 0 | 0 | 2.5M | 198K | 120K | 16K | 102K | 150K | 160K | 0 |
Medicare reimbursement policy volatility
As reported in recent financial filings, the relationship between net income and operating cash flow remains highly volatile, with the company reporting a significant $22.1 million cash outflow in 2026Q1 despite a net loss of $14.5 million, highlighting persistent challenges in converting accounting results into actual liquidity.
The wide variance between net income and operating cash flow suggests that non-cash items and working capital swings are heavily distorting the company's true cash-generating capacity. Investors should monitor whether this disconnect is a structural feature of the diagnostic billing cycle or an indication of deteriorating collection efficiency.
Based on the company's reported figures, free cash flow has exhibited extreme instability, swinging from a positive $19.7 million in 2025Q4 to a negative $34.6 million in 2026Q1, which underscores the difficulty in maintaining consistent cash generation amidst ongoing investments in the diagnostic product portfolio.
The erratic nature of free cash flow suggests that the business model is highly sensitive to the timing of reimbursement receipts and capital expenditure cycles. This lack of predictability makes it difficult to ascertain a clear path toward sustainable, self-funded growth without further reliance on external capital.
According to quarterly data, capital expenditures reached $12.5 million in 2026Q1, representing 14.9% of revenue, which indicates a high level of investment in laboratory infrastructure that may be necessary to support the company's specialized diagnostic testing volume and long-term clinical utility data requirements.
The elevated capital intensity suggests that the company is still in a heavy asset-building phase rather than a mature, cash-harvesting stage. Analysts should evaluate whether these investments are effectively driving incremental test volume or if they represent a recurring burden that will continue to suppress free cash flow margins.
As evidenced by the $19.4 million outflow in 2026Q1, working capital dynamics have turned sharply negative, suggesting that the company is struggling to manage its collection cycles or inventory levels effectively compared to the positive contributions seen in previous quarters like 2025Q4.
The sudden reversal in working capital suggests potential friction in the reimbursement process, possibly linked to delays in payer processing or changes in billing terms. This trend warrants further investigation into whether the company is facing increased difficulty in converting its diagnostic services into timely cash inflows.
Quick answers to the most common questions about buying CSTL stock.
Castle Biosciences, Inc. (CSTL) generated $64.3M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Castle Biosciences, Inc. (CSTL) generated $28.3M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Castle Biosciences, Inc. (CSTL) spent $36.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.