CASTLE BIOSCIENCES INC (CSTL)
SIC breadcrumb: Services > SIC Major Group 80 > SIC 8071 Services-Medical Laboratories
SEC company page: https://www.sec.gov/edgar/browse/?CIK=1447362. Latest filing source: 0001628280-26-012272.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 344,229,000 | USD | 2025 | 2026-02-26 |
| Net income | -24,158,000 | USD | 2025 | 2026-02-26 |
| Assets | 578,556,000 | USD | 2025 | 2026-02-26 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001447362.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|
| Revenue | 22,786,000 | 51,865,000 | 62,649,000 | 94,085,000 | 137,039,000 | 219,788,000 | 332,069,000 | 344,229,000 | |
| Net income | -6,367,000 | 5,277,000 | -10,284,000 | -31,292,000 | -67,138,000 | -57,466,000 | 18,245,000 | -24,158,000 | |
| Operating income | -3,836,000 | 7,328,000 | -6,542,000 | -40,079,000 | -72,855,000 | -67,977,000 | 8,670,000 | -42,810,000 | |
| Diluted EPS | -5.33 | -0.21 | -0.54 | -1.24 | -2.58 | -2.14 | 0.62 | -0.83 | |
| Operating cash flow | -12,295,000 | 7,015,000 | 9,865,000 | -18,983,000 | -41,655,000 | -5,626,000 | 64,866,000 | 64,347,000 | |
| Capital expenditures | 277,000 | 937,000 | 4,751,000 | 3,483,000 | 5,632,000 | 13,621,000 | 28,326,000 | 36,021,000 | |
| Assets | 22,405,000 | 119,746,000 | 439,328,000 | 462,572,000 | 447,329,000 | 453,340,000 | 531,235,000 | 578,556,000 | |
| Liabilities | 32,475,000 | 34,633,000 | 23,637,000 | 50,832,000 | 48,179,000 | 62,071,000 | 75,400,000 | 107,683,000 | |
| Stockholders' equity | -50,311,000 | -56,566,000 | 85,113,000 | 415,691,000 | 411,740,000 | 399,150,000 | 391,269,000 | 455,835,000 | 470,873,000 |
| Cash and cash equivalents | 4,479,000 | 98,845,000 | 409,852,000 | 329,633,000 | 122,948,000 | 98,841,000 | 119,709,000 | 116,729,000 | |
| Free cash flow | -12,572,000 | 6,078,000 | 5,114,000 | -22,466,000 | -47,287,000 | -19,247,000 | 36,540,000 | 28,326,000 |
Ratios
| Metric | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|
| Net margin | -27.94% | 10.17% | -16.42% | -33.26% | -48.99% | -26.15% | 5.49% | -7.02% | |
| Operating margin | -16.83% | 14.13% | -10.44% | -42.60% | -53.16% | -30.93% | 2.61% | -12.44% | |
| Return on equity | 6.20% | -2.47% | -7.60% | -16.82% | -14.69% | 4.00% | -5.13% | ||
| Return on assets | -28.42% | 4.41% | -2.34% | -6.76% | -15.01% | -12.68% | 3.43% | -4.18% | |
| Liabilities / equity | 0.41 | 0.06 | 0.12 | 0.12 | 0.16 | 0.17 | 0.23 | ||
| Current ratio | 2.69 | 7.63 | 20.58 | 14.21 | 8.09 | 6.20 | 7.29 | 5.26 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001447362.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2022-Q2 | 2022-06-30 | -0.06 | reported discrete quarter | ||
| 2022-Q3 | 2022-09-30 | -0.77 | reported discrete quarter | ||
| 2023-Q1 | 2023-03-31 | -1.10 | reported discrete quarter | ||
| 2023-Q2 | 2023-03-31 | -29,204,000 | reported discrete quarter | ||
| 2023-Q2 | 2023-06-30 | 50,138,000 | -0.70 | reported discrete quarter | |
| 2023-Q3 | 2023-06-30 | -18,777,000 | reported discrete quarter | ||
| 2023-Q3 | 2023-09-30 | 61,493,000 | -0.26 | reported discrete quarter | |
| 2023-Q4 | 2023-12-31 | 66,120,000 | -2,580,000 | derived Q4 = FY annual - nine-month YTD | |
| 2024-Q1 | 2024-03-31 | 72,974,000 | -2,534,000 | -0.09 | reported discrete quarter |
| 2024-Q2 | 2024-03-31 | -2,534,000 | reported discrete quarter | ||
| 2024-Q2 | 2024-06-30 | 87,002,000 | 0.31 | reported discrete quarter | |
| 2024-Q3 | 2024-06-30 | 8,920,000 | reported discrete quarter | ||
| 2024-Q3 | 2024-09-30 | 85,782,000 | 0.08 | reported discrete quarter | |
| 2024-Q4 | 2024-12-31 | 86,311,000 | 9,590,000 | derived Q4 = FY annual - nine-month YTD | |
| 2025-Q1 | 2025-03-31 | 87,988,000 | -25,848,000 | -0.90 | reported discrete quarter |
| 2025-Q2 | 2025-03-31 | -25,848,000 | reported discrete quarter | ||
| 2025-Q2 | 2025-06-30 | 86,188,000 | 0.15 | reported discrete quarter | |
| 2025-Q3 | 2025-06-30 | 4,523,000 | reported discrete quarter | ||
| 2025-Q3 | 2025-09-30 | 83,043,000 | -0.02 | reported discrete quarter | |
| 2025-Q4 | 2025-12-31 | 87,010,000 | -2,332,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2026-03-31 | 83,679,000 | -14,522,000 | -0.49 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0001628280-26-031263.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. You should read the following discussion and analysis of financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes and other financial information included in this Quarterly Report on Form 10-Q with our audited financial statements and notes thereto as of and for the years ended December 31, 2025, and 2024 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, including the section entitled “Critical Accounting Estimates,” included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 10-K”), as filed with the Securities and Exchange Commission (the “SEC”) on February 26, 2026. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “we,” “us” and “our” refer to Castle Biosciences, Inc. Forward-Looking Statements The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which are subject to the “safe harbor” created by those sections. These forward-looking statements include, but are not limited to, statements concerning our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management. The words “anticipate,” “believe,” “could”, “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “project,” “will,” “would” or the negative or plural of these terms or other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions or expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part I, Item 1A, “Risk Factors” in the 2025 10-K, Part II, Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q and in our other filings with the SEC. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements, except as may be required by law. Overview Castle Biosciences, Inc. is a molecular diagnostics company offering innovative test solutions to aid clinicians in the diagnosis and treatment of dermatologic cancers, Barrett’s esophagus (“BE”), atopic dermatitis (“AD”), and uveal melanoma (“UM”). Our Test Portfolio We currently offer six commercially available proprietary multi-analyte assays with algorithmic analysis (“MAAA”) tests for use in the fields of dermatology, gastroenterology, ophthalmology, and most recently includes a test to guide systemic treatment decisions in moderate-to-severe atopic dermatitis. Our revenue is primarily generated by our DecisionDx-Melanoma risk stratification test for cutaneous melanoma (“CM”) and our TissueCypher risk stratification test for BE which is supplemented by revenue generated from our DecisionDx-UM risk stratification test for UM. All of our MAAA tests, excluding our recently launched AdvanceAD-Tx test, have been granted Advanced Diagnostic Laboratory Test (“ADLT”) status by the Centers for Medicare and Medicaid (“CMS”) which means each test has demonstrated that (i) when combined with an empirically derived algorithm, it yields a result that predicts the probability a specific individual patient will develop a certain condition or conditions, or will respond to a particular therapy or therapies; and (ii) it provides new clinical diagnostic information that cannot be obtained from any other test or combination of tests. We believe this designation not only demonstrates our focus on developing and validating innovative tests but also enables our Medicare reimbursement rate to be set, over the long term, by the median private payor rate, which we believe provides a fair exchange of value. Further information about Medicare coverage and ADLT status with respect to each of our tests is set forth below. 26 Table of Contents Test Overview Our Dermatology Tests DecisionDx-Melanoma is our proprietary risk stratification gene expression profile (“GEP”) test designed to predict the likelihood of a positive sentinel lymph node and the risk of metastasis or recurrence for patients diagnosed with invasive CM. In a typical year, we estimate that approximately 130,000 patients are diagnosed with invasive CM in the U.S., representing an estimated U.S. total addressable market (“TAM”) of approximately $540 million. We estimate that approximately 50% of patients diagnosed with CM are 65 years of age or older. AdvanceAD-Tx is a non-invasive GEP test designed to guide systemic treatment selection for patients aged 12 years and older with moderate-to-severe AD. The test evaluates the expression of 487 genes across 12 known immune, inflammatory and skin-related pathways to identify the underlying biology driving an individual patient’s disease. Results classify patients into one of two molecular profiles: Janus Kinase (“JAK”) Inhibitor Responder Profile or T helper 2 (“Th2”) Molecular Profile. Using multiple data sources focused on one-year prevalence, we estimate that there are approximately 10 million individuals ages 12 and older in the U.S. with moderate-to-severe AD, representing an estimated U.S. TAM of approximately $33 billion. We commenced a limited access launch of the AdvanceAD-Tx test in November 2025. DecisionDx‑SCC is our proprietary GEP test for use in patients with SCC with one or more risk factors (also referred to as “high-risk” SCC) that both predicts the risk of metastasis as well as response to adjuvant radiation therapy. We estimate 20% of SCC patients, or approximately 200,000 annually in the U.S., are classified as high risk, representing an estimated U.S. TAM of approximately $820 million. MyPath Melanoma is our proprietary, diagnostic GEP test for use in patients with difficult-to-diagnose melanocytic lesions. Of the 2 million suspicious pigmented lesions biopsied annually in the U.S., we estimate that approximately 300,000 of those present difficult-to-diagnose melanocytic lesion, representing an estimated U.S. TAM of approximately $600 million. Our Gastroenterology Test TissueCypher is our proprietary risk stratification spatialomics test designed to predict future development of high-grade dysplasia (“HGD”) and/or esophageal cancer in patients with non-dysplastic (“ND”), indefinite dysplasia (“IND”) or low-grade dysplasia (“LGD”) BE. We estimate a U.S. TAM of approximately $1 billion. In May 2025, we expanded our BE capabilities through the acquisition of Capsulomics, Inc., d/b/a Previse (“Previse”), which includes methylation-based intellectual property and the Esopredict risk-stratification test. We expect these assets to support the future development of TissueCypher and enable the potential incorporation of additional molecular modalities. Beginning in the first quarter of 2026, we began offering Esopredict as a supplemental option when TissueCypher does not produce an actionable result. Revenue and test volume from Esopredict have not been material to date. Our Ophthalmology Test DecisionDx-UM is our proprietary, risk stratification GEP test that predicts the risk of metastasis for patients with UM. We believe DecisionDx-UM is the standard of care in the management of newly diagnosed UM in the majority of ocular oncology practices in the United States. We estimate a U.S. TAM of approximately $10 million. Our Mental Health Test IDgenetix is a PGx test that guides personalized mental health medication selection and management for patients with depression, anxiety and other mental health conditions. After careful further assessments, we discontinued our IDgenetix test in May 2025. Reimbursement The primary source of revenue for our products is reimbursement from third-party payors, which includes government payors, such as Medicare, and commercial payors, such as insurance companies. Achieving broad coverage and reimbursement of our current products by third-party payors and continued Medicare coverage are key components of our financial success. We bill third-party payors and patients for the tests we perform. We have received Medicare coverage for our DecisionDx-Melanoma, TissueCypher, MyPath Melanoma and DecisionDx-UM tests which meet certain criteria for Medicare and Medicare Advantage beneficiaries. DecisionDx-SCC previously received Medicare coverage, which was subsequently impacted by LCD changes finalized in 2025. 27 Table of Contents The Medicare rates discussed below are prior to giving effect to applicable sequestration in effect from time to time as described in further detail under “Government Regulation and Product Approval—Healthcare Reform” included in Item 1, Business, of the 2025 10-K. DecisionDx-Melanoma DecisionDx-Melanoma tests are processed from our Phoenix laboratory and since the second quarter of 2022, have been covered under “foundational” local coverage determinations (“LCD” or “LCDs”) finalized by Medicare Administrative Contractors (“MACs”) Palmetto and Noridian. CMS reviewed and approved DecisionDx-Melanoma for ADLT status in 2019. Our rate is set annually based upon the median private payor rate for the first half of the second preceding calendar year. For example, the rate for 2026 was set using median private payor rate data from January 1, 2024 to June 30, 2024. Our rate for 2024 and 2025 was $7,193 per test and remains $7,193 per test for 2026. TissueCypher Our TissueCypher tests are processed in our Phoenix and Pittsburgh laboratories. Palmetto’s MolDX program oversees MAAA tests that are reported from our Phoenix laboratory and Noridian is the MAC responsible for administering Medicare claims for test reports issued by our Phoenix laboratory. Novitas is the MAC responsible for administering Medicare claims for test reports issued by our Pittsburgh laboratory. CMS reviewed and approved TissueCypher for ADLT status in 2022. Effective January 1, 2023, the published Clinical Laboratory Fee Schedule (“CLFS”) rate for TissueCypher was set at $4,950 per test and remained effective through December 31, 2024. This rate was based on the median private payor rates received between April 1, 2022 and August 31, 2022. Beginning with 2025, the rate for TissueCypher has been set annually based on the median private payor rate for the first half of the second preceding calendar year. The rate for 2026 was set using median private payor rate data from January 1, 2024 to June 30, 2024. Our rate for 2025 was $4,950 per test and remains $4,950 per test for 2026. DecisionDx‑SCC We issue our DecisionDx-SCC tests from our Pittsburgh and Phoenix laboratories. Palmetto’s MolDX (“MolDX”) program oversees MAAA tests that are reported from our Phoenix laboratory and Noridian is the MAC responsible for administering Medicare claims for test reports issued by our Phoenix laboratory. Novitas is the MAC responsible for administering Medicare claims for test reports issued by our Pittsburgh laboratory. CMS reviewed and approved DecisionDx-SCC for ADLT status in 2023. Effective July 1, 2023 and through March 31, 2024, CMS set the initial period rate equal to the list price of $8,500 per test. Effective April 1, 2024, we continued rece [Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. You should read the following discussion and analysis of financial condition and results of operations together with our consolidated financial statements and the related notes included elsewhere in this Annual Report on Form 10-K. This discussion and other parts of this Annual Report on Form 10-K contain forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. Our actual results, performance or achievements could differ materially from any future results, performance or achievements discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the heading “Special Note Regarding Forward-Looking Statements” and “Risk Factors.” The following generally compares our results of operations for the years ended December 31, 2025 and 2024. A detailed discussion comparing our results of operations for the years ended December 31, 2024 and 2023 can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 27, 2025. Overview Castle Biosciences is a molecular diagnostics company offering innovative test solutions to aid clinicians in the diagnosis and treatment of dermatologic cancers, Barrett’s esophagus (“BE”), atopic dermatitis (“AD”), and uveal melanoma (“UM”). 83 Table of Contents Our Test Portfolio We currently offer six commercially available proprietary multi-analyte assays with algorithmic analysis (“MAAA”) tests for use in the fields of dermatology, gastroenterology and ophthalmology, and most recently includes a test to guide systemic treatment decisions in moderate-to-severe atopic dermatitis. Our revenue is primarily generated by our DecisionDx-Melanoma risk stratification test for cutaneous melanoma (“CM”), our TissueCypher risk stratification test for BE which is supplemented by revenue generated from our DecisionDx-SCC risk stratification test for cutaneous squamous cell carcinoma (“SCC”), and our DecisionDx-UM risk stratification test for UM. All of our MAAA tests, excluding our recently launched AdvanceAD-Tx test, have been granted Advanced Diagnostic Laboratory Test (“ADLT”) status by the Centers for Medicare and Medicaid (“CMS”) which means each test has demonstrated that (i) when combined with an empirically derived algorithm, it yields a result that predicts the probability a specific individual patient will develop a certain condition or conditions, or will respond to a particular therapy or therapies; and (ii) it provides new clinical diagnostic information that cannot be obtained from any other test or combination of tests. We believe this designation not only demonstrates our focus on developing and validating innovative tests but also enables our Medicare reimbursement rate to be set, over the long-term, by the median private payor rate, which we believe provides a fair exchange of value. Further information about Medicare coverage and ADLT status with respect to each of our tests is set forth below. Test Overview Our Dermatology Tests DecisionDx-Melanoma is our proprietary risk stratification gene expression profile (“GEP”) test designed to predict the likelihood of a positive sentinel lymph node and the risk of metastasis or recurrence, for patients diagnosed with invasive CM. In a typical year, we estimate approximately 130,000 patients are diagnosed with invasive CM in the U.S., representing an estimated U.S. total addressable market (“TAM”) of approximately $540 million. We estimate that approximately 50% of patients diagnosed with CM are 65 years of age or older. AdvanceAD-Tx is a non-invasive GEP test designed to guide systemic treatment selection for patients aged 12 years and older with moderate-to-severe atopic dermatitis (“AD”). The test evaluates the expression of 487 genes across 12 known immune, inflammatory and skin-related pathways to identify the underlying biology driving an individual patient’s disease. Results classify patients into one of two molecular profiles: Janus Kinase (“JAK”) Inhibitor Responder Profile or T helper 2 (“Th2”) Molecular Profile. Using multiple data sources focused on one-year prevalence, we estimate there are approximately 10.0 million individuals ages 12 and older in the U.S. with moderate-to-severe AD, representing an estimated U.S. TAM of approximately $33 billion. We commenced a limited access launch of the AdvanceAD-Tx test in November 2025. DecisionDx‑SCC is our proprietary GEP test for use in patients with SCC with one or more risk factors (also referred to as “high-risk” SCC) that both predicts the risk of metastasis as well as response to adjuvant radiation therapy. We estimate 20% of SCC patients, or approximately 200,000 annually in the U.S., are classified as high risk, representing an estimated U.S. TAM of approximately $820 million. MyPath Melanoma is our proprietary, diagnostic GEP test for use in patients with difficult-to-diagnose melanocytic lesions. Of the 2 million suspicious pigmented lesions biopsied annually in the U.S., we estimate approximately 300,000 of those present difficult-to-diagnose melanocytic lesion, representing an estimated U.S. TAM of approximately $600 million. Our Gastroenterology Test TissueCypher is our proprietary risk stratification spatialomics test designed to predict future development of high-grade dysplasia (“HGD”) and/or esophageal cancer in patients with non-dysplastic (“ND”), indefinite dysplasia (“IND”) or low-grade dysplasia (“LGD”) BE. We estimate a U.S. TAM of approximately $1 billion. Our Ophthalmology Test DecisionDx-UM is our proprietary, risk stratification GEP test that predicts the risk of metastasis for patients with UM. We believe DecisionDx-UM is the standard of care in the management of newly diagnosed UM in the majority of ocular oncology practices in the United States. We estimate a U.S. TAM of approximately $10 million. 84 Table of Contents Our Mental Health Test IDgenetix was a pharmacogenomic (“PGx”) test that guided personalized mental health medication selection and management for patients with depression, anxiety and other mental health conditions. We discontinued IDgenetix in May 2025 following further evaluation. Commercial Expansion Efforts During the year ended December 31, 2024, we further expanded our dermatology and gastroenterology teams. In late 2024, we changed our commercial strategy for our IDgenetix test, shifting resources to inside sales and non-personal promotion. During the year ended December 31, 2025, we made several strategic acquisitions and partnerships to expand our clinical capabilities and product portfolio. In May 2025, we acquired Previse. This acquisition was intended to expand our GI diagnostic offerings beyond our existing TissueCypher test, representing a growth strategy through acquisition as well as organic product expansion. In June 2025, we entered into a collaboration and license agreement with SciBase to develop a diagnostic test aimed at predicting disease flares in patients with atopic dermatitis. In November 2025, we launched AdvanceAD-Tx, a new gene expression profile test designed to guide systemic treatment decisions for patients with moderate-to-severe AD. This launch represents a material expansion of our product portfolio into a significant new clinical area and a substantial potential market. We will continue to assess market response in determining further commercial expansions and commercial team structure. Reimbursement The primary source of revenue for our products is reimbursement from third-party payors, which includes government payors, such as Medicare, and commercial payors, such as insurance companies. Achieving broad coverage and reimbursement of our current products by third-party payors and continued Medicare coverage are key components of our financial success. We bill third-party payors and patients for the tests we perform. We have received Medicare coverage for our DecisionDx-Melanoma, TissueCypher, MyPath Melanoma, DecisionDx-UM and IDgenetix tests which meet certain criteria for Medicare and Medicare Advantage beneficiaries. DecisionDx-SCC previously received Medicare coverage, which was subsequently impacted by LCD changes finalized in 2025. The Medicare rates discussed below are prior to giving effect to applicable sequestration in effect from time to time as described in further detail under “Government Regulation and Product Approval—Healthcare Reform” included in Item 1, Business, of this Annual Report on Form 10-K. DecisionDx-Melanoma DecisionDx-Melanoma tests are processed from our Phoenix laboratory and since the second quarter of 2022, have been covered under “foundational” local coverage determinations (“LCD” or “LCDs”) finalized by Medicare Administrative Contractors (“MACs”) Palmetto and Noridian. DecisionDx-Melanoma has met ADLT status, as determined by the CMS, since 2019. Since 2022, the rate for DecisionDx-Melanoma is set annually based upon the median private payor rate for the first half of the second preceding calendar year. For example, the rate for 2025 was set using median private payor rate data from January 1, 2023 to June 30, 2023. Our rate for 2023 through 2025 was $7,193 per test and remains $7,193 per test for 2026. TissueCypher Our TissueCypher tests are processed in our Phoenix and Pittsburgh laboratories. Palmetto’s MolDX program oversees MAAA tests that are reported from our Phoenix laboratory and Noridian is the MAC responsible for administering Medicare claims for test reports issued by our Phoenix laboratory. Novitas is the MAC responsible for administering Medicare claims for test reports issued by our Pittsburgh laboratory. 85 Table of Contents On March 24, 2022, CMS determined TissueCypher meets the criteria for “new ADLT” status. ADLT status exempts TissueCypher from what is called the “14-day rule,” which simplifies the billing process for Medicare patients. Effective January 1, 2023, the published CLFS rate for TissueCypher was set at $4,950 per test and remained effective through December 31, 2024. This rate is based on the median private payor rates received between April 1, 2022 and August 31, 2022. Beginning with 2025, the rate for TissueCypher has been set annually based on the median private payor rate for the first half of the second preceding calendar year. Our 2025 rate was $4,950 per test based on the median private payor rate data from January 1, 2023 to June 30, 2023 and remains $4,950 per test for 2026. DecisionDx‑SCC We issue our DecisionDx-SCC tests from our Pittsburgh and Phoenix laboratories. Palmetto’s MolDX (“MolDX”) program oversees MAAA tests that are reported from our Phoenix laboratory and Noridian is the MAC responsible for administering Medicare claims for test reports issued by our Phoenix laboratory. Novitas is the MAC responsible for administering Medicare claims for test reports issued by our Pittsburgh laboratory. DecisionDx-SCC has met “new ADLT” status since 2023. Effective July 1, 2023 and through March 31, 2024, CMS set the initial period rate equal to the list price of $8,500 per test. Effective April 1, 2024, and through December 31, 2025, the published Clinical Laboratory Fee Schedule (“CLFS”) rate for DecisionDx-SCC will continue at $8,500 based on the median private payor rates received between July 1, 2023 and November 30, 2023. On July 4, 2024, Palmetto and Noridian finalized an LCD recommending no coverage for DecisionDx-SCC with an effective date of August 18, 2024. On January 9, 2025, Novitas finalized an oncology biomarker LCD, Genetic Testing for Oncology: Specific Tests, which also lists DecisionDx-SCC as non-covered; that LCD became effective on April 24, 2025. In July 2025, we submitted reconsideration requests for both Novitas and MolDX LCDs. Both Novitas and MolDX subsequently confirmed that our requests were valid. These confirmations represent an important procedural step in the reconsideration process, but it does not indicate coverage or a favorable review outcome. MyPath Melanoma MyPath Melanoma was covered under a test-specific LCD policy through Noridian that became effective in June 2019. Effective August 6, 2023, Palmetto and Noridian issued LCDs that converted the test-specific MyPath Melanoma LCD to a “foundational” LCD and provided coverage for MyPath Melanoma. We estimate that a significant majority of the MyPath Melanoma tests performed for Medicare patients will meet the coverage criteria. On September 6, 2019, MyPath Melanoma was approved as a “new ADLT”. Our rate is set annually based upon the median private payor rate for the first half of the second preceding calendar year. For example, the rate for 2025 was set using median private payor rate data from January 1, 2023 to June 30, 2023. Our rates for 2023, 2024 and 2025 were $1,755, $1,950 and $1,950 per test, respectively. Our 2026 rate remains $1,950 per test. DecisionDx-UM DecisionDx-UM tests are processed from our Phoenix laboratory and are covered under LCDs finalized by MAC administrators Palmetto and Noridian in July 2017. We estimate that a significant majority of the DecisionDx-UM tests performed for Medicare patients will meet the coverage criteria. On May 17, 2019, CMS determined that DecisionDx-UM meets the criteria for “existing ADLT” status. Our rate is set annually based upon the median private payor rate for the first half of the second preceding calendar year. For example, the rate for 2025 was set using median private payor rate data from January 1, 2023 to June 30, 2023. Our rate for 2023 through 2025 was $7,776 per test and remains $7,776 per test for 2026. IDgenetix IDgenetix is currently covered under a Noridian LCD policy and accompanying billing and coding article developed by MolDX. During 2023, we obtained a test-specific PLA CPT code for IDgenetix which became effective October 1, 2023. The CLFS rate of $1,336 per test was effective January 1, 2024. Our reimbursement rate for 2024 was $1,336 per test and remained at $1,336 per test in the first quarter of 2025. Our IDgenetix test was discontinued in May 2025. 86 Table of Contents Government Regulation and Oversight of Laboratory Developed Tests On May 6, 2024, the U.S. Food and Drug Administration (“FDA”) published a final rule on the regulation of LDTs which amended the FDA’s regulations to make explicit that LDT’s are devices under the FD&C Act. However, on March 31, 2025, the U.S. District Court for the Eastern District of Texas vacated the FDA’s LDT final rule. The U.S. government did not appeal the ruling, and the FDA rescinded the rule on September 19, 2025. Accordingly, the FDA’s phased enforcement approach and related requirements are no longer in effect. Our proprietary tests, which were first marketed prior to May 6, 2024, remain approved by and under the oversight of the New York State Department of Health (“NYSDOH”), and we continue to believe that changes in FDA’s regulatory approach to LDTs will have no material impact on our existing test offerings. In July 2025, the FDA granted Breakthrough Device designation to our DecisionDx-Melanoma test. We believe this designation highlights the test’s potential to improve melanoma care through individualized prognostic insights. The Breakthrough Device designation is intended to expedite the development and review of certain medical devices that may offer more effective diagnosis or treatment of life-threatening conditions. Delivered Test Reports The number of test reports we deliver is a key indicator that we use to assess our business. A test report is generated when we receive a sample in our laboratory, and then the relevant test information is entered into our Laboratory Information Management System, the laboratory portion of the test is performed, including proprietary algorithmic analysis of the combined biomarkers and a report is then delivered to the clinician who ordered the test. The number of test reports delivered by us are presented in the table below: For the Year Ended December 31, 2025 Q1 Q2 Q3 Q4 FY 2025 DecisionDx-Melanoma 8,621 9,981 10,459 10,022 39,083 DecisionDx‑SCC 4,375 4,762 4,186 3,971 17,294 MyPath Melanoma 926 1,166 1,151 1,045 4,288 Dermatologic Total 13,922 15,909 15,796 15,038 60,665 TissueCypher 7,432 9,170 10,609 11,803 39,014 DecisionDx-UM 470 468 436 395 1,769 IDgenetix(1) 2,578 1,027 — — 3,605 Grand Total 24,402 26,574 26,841 27,236 105,053 For the Year Ended December 31, 2024 Q1 Q2 Q3 Q4 FY 2024 DecisionDx-Melanoma 8,384 9,585 9,367 8,672 36,008 DecisionDx‑SCC 3,577 4,277 4,195 4,299 16,348 MyPath Melanoma 998 1,099 933 879 3,909 Dermatologic Total 12,959 14,961 14,495 13,850 56,265 TissueCypher 3,429 4,782 6,073 6,672 20,956 DecisionDx-UM 422 456 397 424 1,699 IDgenetix 4,078 4,903 5,045 3,125 17,151 Grand Total 20,888 25,102 26,010 24,071 96,071 (1)The IDgenetix test was discontinued effective May 2025. For the years ended December 31, 2025 and 2024, our dermatologic test report volume increased by 7.8% and 15.5%, respectively, largely driven by continued growth from our DecisionDx-Melanoma and DecisionDx-SCC tests. TissueCypher increased by 86.2% for the year ended December 31, 2025, further contributing to the overall volume increase. For a discussion of how we recognize revenue derived from our tests, refer to “—Components of Results of Operations—Net Revenues” below. 87 Table of Contents For our AdvanceAD-Tx product line, test reports delivered during the year ended December 31, 2025 were de minimis due to the timing of the launch. Of the approximately 150 clinician offices that were granted access, more than 50% ordered AdvanceAD-Tx during the first five weeks of clinical availability. We plan to expand availability in a phased manner throughout 2026. For our DecisionDx-SCC product line, we continue to see opportunities for leverage, where many of the clinicians ordering our DecisionDx-Melanoma are the same clinicians who order our DecisionDx-SCC test. For both years ended December 31, 2025 and 2024, approximately 77% of all clinicians ordering DecisionDx-SCC had also ordered our DecisionDx-Melanoma test during that same period. Information About Certain Metrics The following provides additional information about certain metrics we have disclosed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations. Test Reports Delivered Test reports delivered represent the number of completed test reports delivered by us during the reporting period indicated. The period in which a test report is delivered does not necessarily correspond with the period in which the related revenue, if any, is recognized, due to the timing and amount of adjustments for variable consideration under ASC Topic 606, Revenue from Contracts with Customers. We use this metric to evaluate the growth in adoption of our tests and to measure against our internal performance objectives. We believe this metric is useful to investors in evaluating the volume of our business activity from period-to-period that may not be discernible from our reported revenues under ASC 606. Other Events Impact of Macroeconomic Conditions Macroeconomic conditions, including uncertainties associated with the ongoing conflicts in the Middle East, the ongoing conflict between Ukraine and Russia, economic slowdowns, the recent shutdown of the federal government including regulatory agencies, public health crises, labor shortages, recessions or market corrections, supply chain disruptions, inflation and monetary policy shifts, international tariffs, liquidity concerns at, and failures of, banks and other financial institutions or other disruptions in the banking system or financing markets, higher interest rates and financial and credit market fluctuations, volatility in the capital markets and other evolving macroeconomic developments, continue to have direct and indirect impacts on our business and could in the future materially impact our results of operations and financial condition. We continue to actively monitor the impact of these macroeconomic factors on our results of operations, financial condition and cash flows. The extent of the impact of these factors on our operational performance and financial condition, including our ability to execute our business strategies and initiatives in the expected timeframe, will depend on future developments, which are uncertain and cannot be predicted; however, any continued or renewed disruption resulting from these factors could negatively impact our business. Our Financial Results Our net (loss) income may fluctuate significantly from period to period, depending on the timing of our planned development activities, the growth of our sales and marketing activities and the timing of revenue recognition under ASC 606. We expect our expenses will increase substantially over time as we: •execute clinical studies to generate evidence supporting our current and future product candidates; •execute our commercialization strategy for our current and future commercial products; •continue our ongoing and planned development of new products in our pipeline; •seek to discover and develop additional product candidates; •hire additional scientific and R&D staff; •add additional operational, financial and management information systems and personnel; and •make additional capital expenditures to support business growth and sustain existing operations. 88 Table of Contents Factors Affecting Our Performance We believe there are several important factors that have impacted, and that we expect will continue to impact, our operating performance and results of operations, including: •Report volume. We believe that the number of reports we deliver to clinicians is an important indicator of the growth of adoption among the healthcare provider community. Our revenue and costs are affected by the volume of testing and mix of customers. Our performance depends on our ability to retain and broaden adoption with existing prescribing clinicians, as well as attract new clinicians. Our report volume could be negatively impacted by developments related to evolving macroeconomic developments, as discussed above. •Reimbursement. We believe that expanding reimbursement is an important indicator of the value of our products. Payors require extensive evidence of clinical utility, clinical validity, patient outcomes and health economic benefits in order to provide reimbursement for diagnostic products. Our revenue depends on our ability to demonstrate the value of our products to these payors. •Gross margin. We believe that our gross margin is an important indicator of the operating performance of our business. Higher gross margins reflect the average selling price (“ASP”) of our tests, as well as the operating efficiency of our laboratory operations. •Expansion of our sales force and marketing programs. We believe the expansion of our direct sales force and marketing organization to educate clinicians and pathologists on the value of our molecular testing products will significantly impact our performance. •Integrating acquisitions. Revenue growth, operational results and advances to our business strategy depend on our ability to integrate any acquisitions into our existing business and effectively scale their operations. The integration of acquired assets may impact our revenue growth, increase the cost of operations or may require management resources that otherwise would be available for ongoing development of our existing business. •New product development. A significant aspect of our business is our investment in R&D activities, including activities related to the development of new products. In addition to the development of new product candidates, we believe these studies are critical to gaining clinician adoption of new products and driving favorable coverage decisions by payors for such products. Components of the Results of Operations Net Revenues We generate revenues from the sale of our products. Currently, our revenues are primarily derived from the sale of DecisionDx-Melanoma, TissueCypher, DecisionDx-SCC and DecisionDx-UM. We bill third-party payors and patients for the tests we perform. Under ASC 606, we recognize revenue at the amount we expect to be entitled to receive, subject to a constraint for variable consideration, in the period in which our tests are delivered to the treating clinicians. We have determined that our contracts contain variable consideration under ASC 606 because the amounts paid by third-party payors may be paid at less than our standard rates or not paid at all, with such differences considered implicit price concessions. Variable consideration is recognized only to the extent it is probable that a significant reversal of revenue will not occur in future periods when the uncertainties are resolved. Variable consideration is evaluated and reassessed each reporting period and adjustments are recorded as increases or decreases in revenue. Variable consideration for Medicare claims that are not covered by Medicare, including those claims undergoing appeal, is deemed to be fully constrained due to factors outside our influence (e.g., judgment or actions of third parties) and because the uncertainty of the amount to be received is not expected to be resolved for a long period of time. For these fully constrained claims, we generally recognize revenue in the period the uncertainty is favorably resolved, if at all. Due to potential future changes in Medicare coverage policies and appeal cycles, insurance coverage policies, contractual rates and other trends in the reimbursement of our tests, our revenues may fluctuate significantly from period to period. Our ability to recognize revenue for a test is dependent on the development of reimbursement experience and obtaining coverage decisions. For tests with limited reimbursement experience or no coverage, we recognize revenues based on actual cash collections. 89 Table of Contents Our ability to increase our revenues will depend on our ability to further penetrate our target markets, and, in particular, generate sales through our direct sales force, maintain Medicare coverage for our currently marketed products, develop and commercialize additional tests, including through acquisitions, obtain reimbursement from additional third-party payors and increase our reimbursement rates for tests performed. Cost of Sales (exclusive of amortization of acquired intangible assets) The components of our cost of sales are material and service costs associated with processing testing samples, personnel costs (including salaries, bonuses, benefits and stock-based compensation expense), electronic medical record setup costs, order and delivery systems, shipping charges for sample transport, third-party test fees, and allocated overhead including rent, information technology costs, equipment and facilities depreciation and utilities. Costs associated with testing samples are recorded when the test is processed regardless of whether and when revenues are recognized with respect to that test. As a result, our cost of sales as a percentage of revenue may vary significantly from period to period because we do not recognize all revenues in the period in which the associated costs are incurred. We expect cost of sales in absolute dollars to increase as the number of tests we perform increases. Additionally, we expect cost of sales to increase prior to the launch of new tests or the initiation of significant commercial expansion efforts, as we ready our operations to support anticipated business growth. This includes continued investment in and expansion of our laboratory facilities. Gross margin and gross margin percentage are key indicators we use to assess our business. See the table in “—Results of Operations—Comparison of the Years Ended December 31, 2025 and 2024” for details. Research and Development R&D expenses include costs incurred to develop our tests, collect clinical samples and conduct clinical studies to develop and support our products. These costs consist of personnel costs (including salaries, bonuses, benefits and stock-based compensation expense), prototype materials, laboratory supplies, consulting costs, regulatory costs, electronic medical records setup costs, costs associated with setting up and conducting clinical studies and allocated overhead, including rent, information technology, equipment depreciation and utilities. We expense all R&D costs in the periods in which they are incurred. We expect our R&D expenses to increase in absolute dollars as we continue to invest in R&D activities related to developing enhanced and new products. We expect R&D expenses to increase as we continue to invest in clinical studies and pipeline initiatives. Selling, General and Administrative Selling, general and administrative (“SG&A”) expenses include executive, selling and marketing, legal, finance and accounting, human resources and billing functions. These expenses consist of personnel costs (including salaries, bonuses, benefits and stock-based compensation expense), direct marketing expenses, audit and legal expenses, consulting costs, payor outreach programs and allocated overhead, including rent, information technology, equipment depreciation and utilities. Other administrative and professional services expenses within SG&A are expected to increase as the scale of our business grows, but selling and marketing-related expenses are expected to increase at a higher rate, consistent with our growth strategy. Amortization of Acquired Intangible Assets Amortization of acquired intangible assets is primarily associated with developed technology obtained through acquisitions, such as our acquisitions of the Myriad MyPath Laboratory in May 2021, Cernostics in December 2021, AltheaDx in April 2022 and Previse in May 2025. Interest Income Interest income consists primarily of earnings on cash and cash equivalents, primarily money market funds, and our short-term U.S. government obligations are a component of our marketable investment securities. Net Gains on Equity Securities Net gains on equity securities are primarily attributable to realized and unrealized gains and losses on our equity securities which we present as marketable investment securities. Interest Expense Interest expense is primarily attributable to long-term debt and finance leases. 90 Table of Contents Other Income Other income is primarily attributable to unrealized foreign currency gains and losses on our foreign currency-denominated investments and loan receivable, which are presented as marketable investment securities and other assets, respectively. Income Tax (Benefit) Expense On July 4, 2025, the OBBBA was enacted into law. The OBBBA includes a broad range of tax reform provisions affecting businesses, including reinstatement of permanent expensing of domestic research and development costs, higher EBITDA cap on the deduction for interest expense and 100% bonus depreciation. We will benefit from the reinstatement of permanent expensing of domestic research and development costs and 100% bonus depreciation. Income tax (benefit) expense consists primarily of income taxes related to federal and state jurisdictions in which we conduct business. We maintain a full valuation allowance for deferred tax assets including operating loss carryforwards and research and development credits and other tax credits. Our consolidated financial statements do not reflect any federal or state income tax benefits attributable to the pre-tax losses we have incurred, due to the uncertainty of realizing a benefit from those items. As of December 31, 2025, we had federal NOL carryforwards of $134.8 million, of which $52.9 million will begin to expire in 2032 if not utilized to offset federal taxable income, and $81.9 million may be carried forward indefinitely. Also, as of December 31, 2025, we also had state NOL carryforwards of $113.0 million, which begin to expire in 2030 if not utilized to offset state taxable income. Results of Operations Comparison of the Years Ended December 31, 2025 and 2024 The following table summarizes our results of operations for the periods indicated (in thousands, except percentages): Years Ended December 31, Change 2025 2024 NET REVENUES $ 344,229 $ 332,069 $ 12,160 3.7 % OPERATING EXPENSES Cost of sales (exclusive of amortization of acquired intangible assets) 71,028 60,205 10,823 18.0 % Research and development 51,850 52,041 (191) (0.4) % Selling, general and administrative 229,323 200,047 29,276 14.6 % Amortization of acquired intangible assets 34,838 11,106 23,732 213.7 % Total operating expenses, net 387,039 323,399 63,640 19.7 % Operating (loss) income (42,810) 8,670 (51,480) (593.8) % Interest income 11,772 12,916 (1,144) (8.9) % Net gains on equity securities 1,466 555 911 164.1 % Interest expense (86) (577) 491 85.1 % Other income 144 — 144 NA (Loss) income before income taxes (29,514) 21,564 (51,078) (236.9) % Income tax (benefit) expense (5,356) 3,319 (8,675) (261.4) % Net (loss) income $ (24,158) $ 18,245 $ (42,403) (232.4) % NA = Not applicable 91 Table of Contents Net Revenues The following table provides a disaggregation of net revenues by type (in thousands): Years Ended December 31, 2025 2024 Change Dermatologic(1) $ 216,369 $ 256,996 $ (40,627) Non-Dermatologic(2) 127,860 75,073 52,787 Total net revenues $ 344,229 $ 332,069 $ 12,160 (1)Consists of DecisionDx-Melanoma, DecisionDx-SCC and MyPath Melanoma. (2)Consists of TissueCypher, DecisionDx-UM and IDgenetix. Net revenues for the year ended December 31, 2025 increased by $12.2 million, or 3.7%, to $344.2 million compared to the year ended December 31, 2024 due to a $52.8 million increase in revenue from our non-dermatologic tests offset by a $40.6 million decrease in revenue from our dermatologic tests. The $52.8 million increase in revenues from our non-dermatologic tests was largely attributable to an 86.2% increase in test report volumes for our TissueCypher test, and, to a much lesser extent, a higher realized ASP. Increases in our TissueCypher test report volumes reflect growth through our sales force efforts. Net revenue from our non-dermatologic tests as a percentage of total net revenue increased from 22.6% for the year ended December 31, 2024 to 37.1% for the year ended December 31, 2025. The $40.6 million decrease in net revenues from our dermatologic tests was primarily due to a lower ASP for our DecisionDx-SCC test, following the loss of Medicare LCD coverage effective April 24, 2025, partially offset by increases in test report volumes for our DecisionDx-SCC and DecisionDx-Melanoma tests of 5.8% and 8.5%, respectively. Cost of Sales (exclusive of amortization of acquired intangible assets) Cost of sales (exclusive of amortization of acquired intangible assets) for the year ended December 31, 2025 increased by $10.8 million, or 18.0%, compared to the year ended December 31, 2024, primarily attributable to higher personnel costs, and higher expenses related to services, supplies and depreciation. The increases in personnel costs reflected higher headcount to support business growth in response to increased test report volumes, as well as merit and annual inflationary wage adjustments for existing employees. Higher expenses related to services and supplies were driven by increased test report volumes, while the increase in depreciation expense reflected continued investment in and expansion of our laboratory facilities. Due to the nature of our business, a significant portion of our cost of sales expenses represents fixed costs associated with our testing operations. Accordingly, our cost of sales expense may not necessarily increase or decrease commensurately with change in net revenues from period to period. We expect our cost of sales expenses (exclusive of amortization of acquired intangible assets) to continue to increase in future periods as we hire additional laboratory personnel and invest in related resources to support our expected operational growth and higher test volumes. Gross Margin The following table presents the calculation of gross margin (in thousands, except percentages): Years Ended December 31, 2025 2024 Change Net revenues $ 344,229 $ 332,069 $ 12,160 Less: Cost of sales (exclusive of amortization of acquired intangible assets) 71,028 60,205 10,823 Less: Amortization of acquired intangible assets 34,838 11,106 23,732 Gross margin $ 238,363 $ 260,758 $ (22,395) Gross margin percentage 69.2 % 78.5 % (9.3) % 92 Table of Contents Our gross margin percentage was 69.2% for the year ended December 31, 2025, compared to 78.5% for the same period in 2024. The decrease was primarily due to lower ASP for our DecisionDx-SCC test and higher amortization expense related to the acceleration of our IDgenetix test. In addition, gross margin was impacted by higher cost of sales, as discussed above, driven by increased personnel costs, higher expenses related to services, supplies and depreciation expense resulting from continued investment in and expansion of our laboratory facilities. Research and Development R&D expenses for the year ended December 31, 2025 remained comparable to the year ended December 31, 2024, primarily due to higher personnel costs offset by lower clinical studies cost. The increase in higher personnel cost is driven by increased headcount to support ongoing research activities and continued business growth. We expect to continue incurring R&D expenses through our continued investments in our ongoing pipeline initiatives and as we seek opportunities to build evidentiary support and new tests where commercial opportunities exist. Selling, General and Administrative The following table provides a breakdown of SG&A expenses (in thousands): Years Ended December 31, 2025 2024 Change Sales and marketing $ 138,115 $ 123,467 $ 14,648 General and administrative 91,208 76,580 14,628 Total selling, general and administrative expense $ 229,323 $ 200,047 $ 29,276 Sales and marketing expenses increased by $14.6 million, or 11.9%, for the year ended December 31, 2025 compared to the year ended December 31, 2024. The increase is primarily due to higher personnel costs, higher expenses associated training events and speaker conferences and higher sales related travel expenses. Increases in personnel costs reflect a higher headcount as well as merit and annual inflationary wage adjustment for existing employees. Higher test report volumes are a result of our continued investments in human capital for our sales organization. Stock-based compensation expense included in sales and marketing expense was $15.3 million for the year ended December 31, 2025, compared to $17.3 million for the year ended December 31, 2024. General and administrative expenses increased by $14.6 million, or 19.1%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase is primarily due to higher personnel costs and higher information technology-related costs. Increases in personnel costs reflect headcount expansions in our administrative support functions as well as merit and annual inflationary wage adjustment for existing employees. Stock-based compensation expense included in general and administrative expense was $17.4 million for the year ended December 31, 2025, compared to $17.8 million for the year ended December 31, 2024. Amortization of Acquired Intangible Assets Amortization expense increased by approximately $23.7 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to our decision to discontinue the IDgenetix test offering beginning in May 2025. As a result of this decision, we revised the estimated useful life of the related developed technology intangible asset and fully amortized the remaining carrying value as of March 31, 2025. To a lesser extent, the increase is also attributable to amortization of the developed technology intangible asset recognized in association with the Esopredict test following our acquisition of Previse in May 2025. Interest Income Interest income decreased by $1.1 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily as a result of lower interest rates on our cash, cash equivalents and marketable investment securities. Net Gains on Equity Securities The net gains on equity securities increased by $0.9 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to changes in the fair value of our equity securities, including both unrealized and realized gains recognized during the period. 93 Table of Contents Interest Expense Interest expense decreased by $0.5 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to the capitalization of interest expense related to the construction of our Friendswood headquarters. Construction of the headquarters commenced in late 2024, resulting in a higher level of capitalized interest in 2025 compared to the prior year. Income Tax (Benefit) Expense Income tax benefit increased by $8.7 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to the partial release of the valuation allowance on our federal deferred tax assets resulting from new deferred tax liabilities recognized upon consolidating Previse in the current period. The increase also reflected revised estimates of pre-tax income due to uncertainty regarding Medicare coverage for our DecisionDx-SCC test and updated financial information, along with changes in stock-based compensation, permanent differences, valuation allowance adjustments, research and development tax credits, and state income taxes. The prior-year period reflected net income compared to a net loss in the current period. Stock-Based Compensation Expense The following table indicates the amount of stock-based compensation expense (non-cash) included in the consolidated statements of operations (in thousands): Years Ended December 31, 2025 2024 Change Cost of sales (exclusive of amortization of acquired intangible assets) $ 5,666 $ 5,529 $ 137 Research and development 7,555 9,598 (2,043) Selling, general and administrative 32,672 35,193 (2,521) Total stock-based compensation expense $ 45,893 $ 50,320 $ (4,427) Stock-based compensation expense, which is allocated among cost of sales, R&D expense and SG&A expense, totaled $45.9 million for the year ended December 31, 2025 compared to $50.3 million for the year ended December 31, 2024. The decrease was primarily attributable to lower expense associated with stock option awards, reflecting our transition to granting only restricted stock units (“RSUs”) beginning 2023 and the continued amortization of higher-fair-value stock option grants issued in prior years. 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 December 31, 2025, we had 883 employees compared to 761 as of December 31, 2024. As of December 31, 2025, total unrecognized stock-based compensation cost related to outstanding awards was $64.7 million, which is expected to be recognized over a weighted-average period of 2.4 years. Liquidity and Capital Resources Sources of Liquidity Our principal sources of liquidity are our cash and cash equivalents, marketable investment securities and cash generated from the sale of our products. Our marketable investment securities consist primarily of investment-grade debt securities and equity securities, all of which are readily available for use in current operations. As of December 31, 2025 and 2024, we had marketable investment securities of $182.8 million and $173.4 million, respectively, and cash and cash equivalents of $116.7 million and $119.7 million, respectively. On April 4, 2025, we amended the 2024 Loan and Security Agreement (the “2024 LSA”) to modify certain terms, including the extension of the draw period for our line of credit from March 31, 2025 to September 30, 2025. In August 2025, we exercised the interest-only milestone provision under the 2024 LSA to extend the interest-only period on the term loan from November 30, 2025 to December 1, 2026. We had not made any draws on the line of credit. The line of credit under the 2024 LSA expired on September 30, 2025 and was no longer available as a source of liquidity thereafter. 94 Table of Contents Our liquidity has been primarily derived from the revenue generated from the sale of our products. As discussed under the caption “Material Cash Requirements,” below, we believe that our existing cash and cash equivalents, marketable investment securities and anticipated cash generated from sales of our products will be sufficient to fund our planned operations for at least the next 12 months. However, we have based these estimates on assumptions that may prove to be wrong, and could result in us depleting our capital resources sooner than expected. As mentioned above, we expect to use a portion of our cash and cash equivalents and marketable investment securities to further support and accelerate our R&D activities, including the clinical studies noted above in “—Components of the Results of Operations—Research and Development.” Material Cash Requirements Our primary uses of capital are, and we expect will continue to be, compensation and related expenses, clinical R&D services, laboratory operations, equipment and related supplies, legal and other regulatory expenses, general administrative costs and, from time to time, expansion of our laboratory and office facilities in support of our growth. We anticipate that a substantial portion of our cash requirements in the foreseeable future will relate to the further commercialization of our currently marketed products, the development of our future product candidates in our pipeline and the potential commercialization of these pipeline products, should their development be successful. In February 2024, we purchased a plot of land in Friendswood, Texas for cash consideration of $7.2 million, for the purpose of developing a commercial office building to serve as our corporate headquarters. The development project included a four-story building, comprising approximately 80,000 square feet of Class A office space. Construction began in May 2024 and we completed the portions of the building that serves as our headquarters in January 2026, at which time we began occupying the building. Over the duration of this project, we incurred significant capital expenditures through payments to the developer under a percentage-of-completion basis. As of December 31, 2025, the development project is expected to cost a total of approximately $42.8 million. During the years ended December 31, 2025 and 2024, we incurred capital expenditures of $31.0 million and $9.3 million, respectively, related to this development project. We expect to incur the remaining cost for the building in the first quarter of 2026. We intend to use our existing cash and cash equivalents to pay for remainder of this project. Since our inception, we have generally incurred significant losses and negative operating cash flows, and we have relied heavily on proceeds from our financing activities to fund capital expenditures, business expansion campaigns and to offset operating deficits. For the year ended December 31, 2025, we recognized net loss of $24.2 million and had positive operating cash flow of $64.3 million; however, we may be unable to sustain positive cash flows in future periods. Collections on Medicare claims for our DecisionDx-SCC test represented a significant portion of our operating cash flows during 2024. Medicare coverage for the DecisionDx-SCC test was discontinued in April 2025, which has resulted in reduced revenues and cash inflows from this test during 2025, and these reductions are expected to continue unless our reconsideration requests related to both the MolDX and Novitas LCDs are approved. Our ability to maintain profitability will heavily depend on us maintaining Medicare coverage for our currently marketed products, on the successful commercialization of the products we plan to launch in the future, and our ability to manage operating expenses. We expect to incur additional expenses in the future as we invest in the commercialization of our existing products and the development and commercialization of our current pipeline products and future product candidates. We believe that our existing cash and cash equivalents, marketable investment securities and anticipated cash generated from the sale of our commercial products will be sufficient to fund our operations for at least the next 12 months. We believe we will meet longer-term expected cash requirements and obligations through a combination of existing cash and cash equivalents, marketable investment securities and anticipated cash generated from sales of our products and issuances of equity securities or debt offerings. However, we have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. There are numerous risks and uncertainties associated with developing genomic tests, including, among others, the uncertainty of: •successful commencement and completion of clinical study protocols; •successful identification and acquisition of tissue samples; •the development and validation of genomic classifiers; and •acceptance of new genomic tests by clinicians, patients and third-party payors including competitor actions. 95 Table of Contents Because of the numerous risks and uncertainties associated with research, development and commercialization of product candidates, we are unable to estimate our exact working capital requirements. Our future funding requirements will depend on and could increase significantly as a result of, many factors, including those listed above as well as those listed in Part I, Item 1A., “Risk Factors” in this Annual Report on Form 10-K and in our other filings with the SEC. In the event additional funding is required, we expect that we would use a combination of equity and debt financings, which may not be available to us when needed, on terms that we deem to be favorable or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of common stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. Any disruptions to, or volatility in, the credit and financial markets or any deterioration in overall economic conditions may make any necessary debt or equity financing more difficult to obtain, more costly and/or more dilutive. If we are unable to raise additional funds through debt or equity financing or other arrangements when needed, we may be required to delay, limit, reduce or terminate our product discovery and development activities or future commercialization efforts. Long-Term Debt Our long-term debt is presented in the table below (in thousands): As of December 31, 2025 2024 Term debt $ 10,200 $ 10,200 Unamortized discount (143) (177) Total debt, net 10,057 10,023 Less: Current portion of long-term debt (417) (278) Total long-term debt $ 9,640 $ 9,745 2024 Loan and Security Agreement On March 26, 2024 (the “Closing Date”), we entered into the 2024 LSA, as amended in April 2025, by and between us, our wholly owned subsidiary, Castle Narnia Real Estate Holding 1, LLC and Silicon Valley Bank, a division of First-Citizens Bank & Trust Company (the “Lender”). The 2024 LSA provides for a term loan in the principal amount of $10.0 million, which was drawn on the Closing Date (the “2024 Term Loan”) and provided for a $25.0 million line of credit that was available at our option from the Closing Date through September 30, 2025, with the same interest rate and maturity as the 2024 Term Loan (the “2024 Credit Line”), which expired on September 30, 2025, as discussed below. The Consent and First Amendment executed on April 4, 2025, modified certain terms of the 2024 LSA, including the extension of the draw period for the line of credit from March 31, 2025 to September 30, 2025. The obligations under the 2024 LSA are secured by substantially all of our assets, excluding intellectual property, the real property held by us, and are subject to certain other exceptions and limitations. We have the right to prepay the 2024 LSA in whole, subject to a prepayment fee of approximately 1.50% if paid prior to March 26, 2026. Amounts repaid may not be reborrowed. The 2024 LSA contains customary conditions of borrowing, events of default and covenants, including covenants that restrict our ability to dispose of assets, merge with or acquire other entities, incur indebtedness and make distributions to holders of our capital stock. Should an event of default occur, including the occurrence of a material adverse change, we could be liable for immediate repayment of all obligations under the 2024 LSA. Should we seek to further amend the terms of the 2024 LSA, the consent of the Lender would be required. As of December 31, 2025, we were in compliance with all of the covenants. The 2024 LSA bears interest at a floating rate equal to the greater of (a) the WSJ Prime Rate plus 0.25% or (b) 6.00% per annum. The 2024 Term Loan is interest-only from the Closing Date through November 30, 2025, subject to extension under the Interest-Only Extension Milestone provision (as defined in the 2024 LSA). On August 26, 2025, we elected to extend the interest-only period to December 1, 2026. Beginning in December 2026, the principal payments will be made in equal monthly installments through the maturity date of November 1, 2028. 96 Table of Contents In addition, we are required to make a final payment equal to 2.00% of the aggregate original principal amounts of the 2024 Term Loan, due at maturity or upon full repayment. 2024 Term Loan On the Closing Date, we drew $10.0 million under the 2024 Term Loan. We are obligated to make a final payment of $0.2 million under the terms of the 2024 LSA final payment provisions. A discount on debt equal to this obligation was recorded on the draw date and is being amortized as additional interest expense using the effective interest method over the term of the debt. As of December 31, 2025, no principal payments have been made and the weighted-average effective interest rate for all outstanding debt under the 2024 Term Loan was 7.69%. 2024 Credit Line We had a $25.0 million line of credit under the terms and provisions of the 2024 LSA from the Closing Date through September 30, 2025. On September 30, 2025, the 2024 Credit Line expired and no draws had been made on it. Leases We have entered into various operating and finance leases, which are primarily associated with our laboratory facilities and office space. Total undiscounted future minimum payment obligations under our operating leases and finance leases as of December 31, 2025 totaled approximately $39.9 million, of which $2.6 million is payable in 2026 and $37.3 million is payable through early 2037. The leases expire on various dates through 2037 and provide certain options to renew for additional periods. We expect our lease obligations may increase in the future as we expand our facilities, operations and headcount in support of the anticipated growth in our portfolio of commercial products and pipeline tests. Refer to Note 10 of the consolidated financial statements for additional information on our leasing arrangements. Cash Flows The following table summarizes our sources and uses of cash and cash equivalents for each of the periods presented (in thousands): Years Ended December 31, 2025 2024 Net cash provided by operating activities $ 64,347 $ 64,866 Net cash used in investing activities (60,367) (50,137) Net cash (used in) provided by financing activities (6,960) 6,139 Net change in cash and cash equivalents (2,980) 20,868 Cash and cash equivalents, beginning of year 119,709 98,841 Cash and cash equivalents, end of year $ 116,729 $ 119,709 Operating Activities Net cash provided by operating activities was $64.3 million for the year ended December 31, 2025, and was primarily attributable to non-cash stock-based compensation expense of $45.9 million, depreciation and amortization of $40.8 million, decreases in accounts receivable of $6.9 million, increases in accrued compensation of $5.7 million and increases in accounts payable of $3.1 million partially offset by the net loss of $24.2 million, decreases in deferred income taxes of $6.2 million, increases in accretion of discounts on marketable investment securities of $4.2 million, net gains on equity securities of $1.5 million, and increases in inventory of $2.1 million. Net cash provided by operating activities was $64.9 million for the year ended December 31, 2024, and was primarily attributable to the net income of $18.2 million, non-cash stock-based compensation expense of $50.3 million, depreciation and amortization of $16.0 million, increases in accrued compensation of $3.6 million, increases in deferred income taxes of $1.4 million, partially offset by increases in accounts receivable of $12.6 million, increases in accretion of discounts on marketable investment securities of $6.7 million, increases in accounts payable of $4.4 million and increases in prepaid expenses and other current assets of $1.1 million. 97 Table of Contents The $0.5 million decrease in net cash provided by operating activities for the year ended December 31, 2025 compared to the year ended December 31, 2024 is primarily due to increases in collections from customers attributable to higher net revenues partially offset by increases in operating expenditures. In part, the cash used during the year ended December 31, 2025 reflects the payment of annual cash bonuses to our employees as well as certain health care benefit payments totaling $22.5 million compared to $20.8 million during the same period in 2024. Investing Activities Net cash used in investing activities was $60.4 million for the year ended December 31, 2025 and consisted primarily of purchases of marketable investment securities of $188.7 million, purchases of property and equipment of $36.0 million, our asset acquisition of Previse for $18.7 million, purchases of debt securities classified as held-to-market of $5.6 million and $2.1 million from the issuance of a loan receivable, partially offset by the maturity of marketable investment securities of $189.2 million and $1.5 million in proceeds from the sale of equity securities. Net cash used in investing activities was $50.1 million for the year ended December 31, 2024 and consisted primarily of purchases of marketable investment securities of $205.7 million and purchases of property and equipment of $28.3 million, partially offset by the maturity of marketable investment securities of $183.9 million. The $10.2 million increase in cash used in investing activities for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily due to our acquisition of Previse for $18.7 million, which includes both the cash consideration and direct transaction costs, $7.7 million in increased purchases of property and equipment, $5.6 million in purchases of debt securities classified as held-to-market and $2.1 million from the issuance of a loan receivable, partially offset by an increase of $5.3 million in proceeds from maturing marketable investment securities and $17.0 million fewer purchases of such securities. Financing Activities Net cash used in financing activities was $7.0 million for the year ended December 31, 2025, and consisted primarily of the $11.7 million payment of employee taxes attributable to the vesting of RSUs, partially offset by $2.4 million of proceeds from contributions to our 2019 Employee Stock Purchase Plan (the “ESPP”) and $2.2 million of proceeds from the exercise of stock options. Net cash provided by financing activities was $6.1 million for the year ended December 31, 2024, and consisted primarily of $10.0 million of proceeds from issuance of long-term debt and $3.0 million of proceeds from contributions to our ESPP and $2.0 million of proceeds from the exercise of stock options, partially offset by the $8.8 million payment of employee taxes attributable to the vesting of RSUs. Inflation In 2021, the rate of inflation in the U.S. significantly increased until the second half of 2022 when the rate began to subside. In 2023 through 2025, the inflation rate continued to subside but remained higher than rates experienced in 2020. We continue to experience inflationary pressures, primarily in increased personnel costs and price increases for certain lab supplies. We anticipate possible inflationary impacts on other cost areas in the future. The extent of any future impacts from inflation on our business and our results of operations will be dependent upon how long the elevated inflation levels persist and the extent to which the rate of inflation were to further increase, if at all, neither of which we are able to predict. If elevated levels of inflation were to persist or if the rate of inflation were to accelerate, the purchasing power of our cash and cash equivalents and marketable investment securities may be further diminished, our expenses could increase faster than anticipated and we may utilize our capital resources sooner than expected. Further, given the complexities of the reimbursement landscape in which we operate, our payors may be unwilling or unable to increase reimbursement rates to compensate for inflationary impacts. As such, the effects of inflation have had, and may continue, to adversely impact our results of operations, financial condition and cash flows. Critical Accounting Estimates Our consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our consolidated financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions. 98 Table of Contents While our significant accounting policies are described in more detail in Note 2 to our audited consolidated financial statements, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our consolidated financial statements. Revenue Recognition We recognize revenue in accordance with ASC 606. In accordance with ASC 606, we follow a five-step process to recognize revenues: (1) identify the contract with the customer, (2) identify the performance obligations, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations and (5) recognize revenues when the performance obligations are satisfied. We have determined that we have a contract with the patient when the treating clinician orders the test. Our contracts generally contain a single performance obligation, which is the delivery of the test report, and we satisfy our performance obligation at a point-in-time upon the delivery of the test report to the treating clinician, at which point we can bill for the report. The amount of revenue recognized reflects the amount of consideration to which we expect to be entitled, or the transaction price, and considers the effects of variable consideration. All of our revenues from contracts with customers are associated with the provision of diagnostic, prognostic, and predictive testing services. Our revenues are primarily attributable to our DecisionDx-Melanoma test for CM, our TissueCypher test for patients diagnosed with BE and our DecisionDx-SCC test for SCC. We also provide our MyPath Melanoma test for patients with melanocytic lesions, our DecisionDx-UM test for UM and IDgenetix, a PGx testing service focused on mental health. We discontinued offering our IDgenetix test in May 2025. Once we satisfy our performance obligations and bill for the service, the timing of the collection of payments may vary based on the payment practices of the third-party payor and the existence of contractually established reimbursement rates. The payments for our services are primarily made by third-party payors, including Medicare and commercial health insurance carriers. Certain contracts contain a contractual commitment of a reimbursement rate that differs from our list prices. However, absent a positive coverage policy, with or without a contractually committed reimbursement rate, with a commercial carrier or governmental program, our diagnostic tests may or may not be paid by these entities. In addition, patients do not enter into direct agreements with us that commit them to pay any portion of the cost of the tests in the event that their insurance provider declines to reimburse us. We may pursue, on a case-by-case basis, reimbursement from such patients in the form of co-payments and co-insurance, in accordance with the contractual obligations that we have with the insurance carrier or health plan. These situations may result in a delay in the collection of payments. The Medicare claims that are covered by Medicare are generally paid at a rate established on Medicare’s Clinical Laboratory Fee Schedule or by the respective Medicare contractor within 30 days from receipt. Medicare claims that were either submitted to Medicare prior to the LCD or other coverage commencement date or are not covered but meet the definition of being medically reasonable and necessary pursuant to the controlling Section 1862(a)(1)(A) of the Social Security Act are generally appealed and may ultimately be paid at the first (termed “redetermination”), second (termed “reconsideration”) or third level of appeal (de novo hearing with an ALJ). A successful appeal at any of these levels may result in prompt payment. 99 Table of Contents In the absence of Medicare coverage, contractually established reimbursement rates or other coverage, we have concluded that our contracts include variable consideration because the amounts paid by Medicare or commercial health insurance carriers may be paid at less than our standard rates or not paid at all, with such differences considered implicit price concessions. Variable consideration attributable to these price concessions is measured at the expected value using the “most likely amount” method under ASC 606. The amounts are estimated using historical average collection rates by test type and payor category taking into consideration the range of possible outcomes, the predictive value of our past experiences, the time period of when uncertainties expect to be resolved and the amount of consideration that is susceptible to factors outside of our influence, such as the judgment and actions of third parties. Such variable consideration is included in the transaction price only to the extent it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainties with respect to the amount are resolved. Variable consideration may be constrained and excluded from the transaction price in situations where there is no contractually agreed upon reimbursement coverage or in the absence of a predictable pattern and history of collectability with a payor. Accordingly, in such situations revenues are recognized on the basis of actual cash collections. Variable consideration for Medicare claims that are not covered by Medicare, including those claims undergoing appeal, is deemed to be fully constrained due to factors outside our influence (e.g., judgment or actions of third parties) and the uncertainty of the amount to be received is not expected to be resolved for a long period of time. Variable consideration is evaluated each reporting period and adjustments are recorded as increases or decreases in revenues. Included in revenues for the years ended December 31, 2025 and 2024 were $7.6 million and $1.8 million of net negative revenue adjustments, respectively, associated with changes in estimated variable consideration related to performance obligations satisfied in previous periods. These amounts include (i) adjustments for actual collections versus estimated amounts and (ii) cash collections and the related recognition of revenue in current period for tests delivered in prior periods due to the release of the constraint on variable consideration. Stock-Based Compensation Stock-based compensation expense for equity instruments issued to employees and non-employees, including stock options, RSUs, performance-based restricted stock units (“PSUs”) and purchase rights issued under the ESPP is measured based on the grant date fair value of the awards. For stock options and purchase rights granted under the ESPP, we estimate the grant date fair value using the Black-Scholes option-pricing valuation model. For RSUs and PSUs, we use the closing price of our common stock on the date of grant to determine the fair value. We recognize compensation costs on a straight-line basis for awards with only service conditions, which is generally the awards’ vesting period, typically four years for options and RSUs and the two-year offering period for the ESPP. PSUs vest upon the achievement of certain performance conditions and the provision of service with us through a specified period. Accruals of compensation cost for PSUs are based on the probable outcome of the performance conditions and are reassessed each reporting period. We recognize compensation cost for PSUs separately for each vesting tranche on a ratable basis over the requisite service period. The requisite service period for PSUs is based on an analysis of vesting requirements and performance conditions for the particular award. Under specific circumstances, certain employees are entitled to acceleration of vesting of a portion of their awards upon retirement, subject to age, service and notice requirements. In these cases, the requisite service period takes into consideration the employee’s retirement eligibility, and is reassessed at each reporting date. For the ESPP, the requisite service period is generally the period of time from the offering date to the purchase date. Forfeitures are accounted for as they occur. Set forth below is a description of the significant assumptions used in the option pricing model: •Expected term. The expected term is the period of time that granted options are expected to be outstanding. For stock options, we have set the expected term using the simplified method based on the weighted-average of both the period to vesting and the period to maturity for each option as we have concluded that its stock option exercise history does not provide a reasonable basis upon which to estimate the expected term. For the ESPP, the expected term is the period of time from the offering date to the purchase date. •Expected volatility. Previously, because of the limited period of time our stock had been traded in an active market, we calculated expected volatility by using the historical stock prices of a group of similar companies looking back over the estimated life of the option or the ESPP purchase right and averaging the volatilities of these companies. In the third quarter of 2021, we revised this approach to include our own stock price on a relative basis to the peer group, as our common stock had been actively traded for more than two years. By the third quarter of 2025, our stock price has been fully incorporated as the sole input in the calculation. 100 Table of Contents •Risk-free interest rate. We base the risk-free interest rate used in the Black-Scholes valuation model on the market yield in effect at the time of option grant and at the offering date for the ESPP provided from the Federal Reserve Board’s Statistical Releases and historical publications from the Treasury constant maturities rates for the equivalent remaining terms. •Dividend yield. We have not paid, and do not have plans to pay, cash dividends. Therefore, we use an expected dividend yield of zero in the Black-Scholes option valuation model. The fair value of our common stock is also an assumption used to determine the fair value of stock options. The fair value of our common stock is the closing selling price per share of our common stock as reported on the Nasdaq Global Market on the date of grant or other relevant determination date. The following table sets forth the assumptions used to determine the fair value of stock options: Years Ended December 31, 2025(1) 2024 2023 Average expected term (years) N/A 5.0 5.0 Expected stock price volatility N/A 80.20% - 80.20% 75.57% - 76.01% Risk-free interest rate N/A 4.39% - 4.39% 3.57% - 3.57% Dividend yield N/A —% —% (1)For the year ended December 31, 2025, no stock options were granted. The following table sets forth assumptions used to determine the fair value of the purchase rights issued under the ESPP: Years Ended December 31, 2025 2024 2023 Average expected term (years) 1.2 1.2 1.3 Expected stock price volatility 56.55% - 85.21% 59.85% - 105.39% 72.80% - 130.95% Risk-free interest rate 3.52% - 4.22% 3.82% - 5.14% 4.74% - 5.33% Dividend yield —% —% —% Intangible Assets and Goodwill Intangible assets Our intangible assets, which are comprised primarily of acquired developed technology, are considered to be finite-lived and are amortized on a straight-line basis over their estimated useful lives. Estimating the useful lives of our intangible assets requires considerable judgment. In determining the estimated useful lives, management considers factors such as historical experience, industry and regulatory factors, competition, patent expirations and commercial plans. If new information becomes available in future periods, we may be required to revise our estimated useful lives. If the revised useful lives are shorter than originally estimated, our future amortization expense will increase. In late 2024, we revised our commercial strategy for the IDgenetix test, reallocating resources to inside sales and non-personal promotions. In December 2024, we observed month-to-month decreases in IDgenetix test reports, which persisted through year-end. We believe these factors indicated a need to revise the remaining useful life of our IDgenetix developed technology intangible asset. On December 1, 2024, we adjusted the estimated remaining useful life from approximately 12 years to 13 months. During the first quarter of 2025, we made the decision to discontinue our IDgenetix test offering, effective May 2025. As a result of this decision, we further revised the estimated useful life of the asset and determined that the intangible asset should be fully amortized as of March 31, 2025. This change resulted in an acceleration of amortization expense of approximately $20.1 million. 101 Table of Contents Recent Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740)—Improvements to Income Tax Disclosures (“ASU 2023-09”), which is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 provide for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. The guidance was effective for public entities for fiscal years beginning after December 15, 2024. We adopted ASU 2023-09 prospectively in fiscal year 2025 for the annual reporting period ending December 31, 2025. Please refer to Note 15 - Income Taxes, to our Consolidated Financial Statements for details. In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income (Subtopic 220-40)—Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses (“ASU 2024-03”), which specifies additional disclosure requirements. The amendments in ASU 2024-03 require disclosure about the composition of certain income expense line items, such as purchases of inventory, employee compensation, and other expenses, as well as disclosure about selling expenses. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact this update will have on the consolidated financial statements and disclosures. In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Practical Expedient for Certain Current Receivables (“ASU 2025-05”), which provides a practical expedient for estimating expected credit losses on current accounts receivable and contract assets arising from transactions under ASC 606. The practical expedient allows entities to assume that current conditions remain unchanged over the remaining life of the receivables. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, including interim periods within those annual periods. Early adoption is permitted. We are currently evaluating the impact this update will have on the consolidated financial statements and disclosures. We have evaluated all other recently issued, but not yet effective, accounting pronouncements and do not believe that these accounting pronouncements will have any material impact on our consolidated financial statements or disclosures upon adoption.