Castle Biosciences, Inc. (CSTL) shares plummeted 14.21% in Tuesday's trading session following the release of its disappointing first-quarter 2025 earnings report. The medical diagnostics company's results fell significantly short of analysts' expectations, triggering a massive sell-off that began in pre-market trading and intensified throughout the day.

For the quarter ended March 31, Castle Biosciences reported a quarterly adjusted loss of 20 cents per share, considerably wider than the mean expectation of a 7-cent loss per share from nine analysts. This represents a substantial deterioration from the same quarter last year when the company reported a loss of 9 cents per share. The reported EPS showed an even more significant loss of 90 cents, resulting in a quarterly loss of $25.85 million. Despite the earnings miss, there was a silver lining as revenue rose 20.6% to $87.99 million, surpassing analysts' expectations of $80.34 million.

The sharp stock decline comes amid an already challenging year for Castle Biosciences, with its shares down 27.4% year-to-date before this latest setback. However, despite the negative earnings surprise and the stock's poor performance, Wall Street maintains a bullish outlook on CSTL. The stock currently has a consensus "strong buy" rating and a median 12-month price target of $40.00, suggesting that analysts believe the company may overcome its current difficulties in the long term.