Circle Internet Group Q2 Earnings Call Highlights

Key Points

• Q2 revenue and reserve income rose 7% to $701 million, while adjusted EBITDA increased 8% to $143 million. USDC circulation grew 19% year over year to $73.3 billion, although the reserve return rate fell to 3.48%.
• USDC network activity accelerated, with daily on-chain transaction volume up 151% to $163 billion. Circle also renewed its Coinbase agreement and said its Arc institutional blockchain mainnet is scheduled to launch Sept. 16, with DTCC and BlackRock partnerships.
• Circle raised its 2026 other-revenue outlook to $310 million-$330 million, primarily due to expected Arc-related revenue, and lifted its revenue-less-distribution-cost margin forecast to 41.7%-43.7%. Its payments network reached $23 billion in annualized volume as of July 31.

Circle Internet Group NYSE: CRCL reported second-quarter total revenue and reserve income of $701 million, up 7% from a year earlier, as growth in USDC circulation and other revenue was partly offset by a lower reserve return rate.

USDC circulation ended the quarter at $73.3 billion, increasing 19% year over year, while average circulation reached a quarterly record of $76.5 billion, according to Chief Financial Officer Jeremy Fox-Geen. The reserve return rate was 3.48%, down 66 basis points from the prior-year period, reflecting a decline in SOFR.

Adjusted EBITDA rose 8% year over year to $143 million, with an adjusted EBITDA margin of 50%. Revenue less distribution costs margin was 41.2%, up three percentage points from a year earlier. Adjusted operating expenses increased 23% to $146 million as Circle continued to invest in product development, market infrastructure and artificial intelligence capabilities.

USDC Network Activity and Partnerships

Chief Executive Officer Jeremy Allaire said USDC transaction activity continued to expand despite weakness in broader digital asset markets. Daily on-chain transaction volume averaged $163 billion during the quarter, up 151% year over year, while total quarterly minting and redemption volume reached $170 billion. Circle said daily minting and redemption averaged $1.9 billion, up 105% from a year earlier.

Circle cited Visa data indicating that USDC accounted for nearly 70% of stablecoin transaction volume in June. Fox-Geen said the figure was up from 36% in the second quarter of the prior year. The company also said that USDC balances held in Circle’s platform infrastructure rose 106% year over year to $12.4 billion, representing 17% of total circulation.

The company renewed its agreement with Coinbase under existing terms, Allaire said, keeping USDC central to Coinbase’s products. Circle also addressed competition for stablecoin distribution, saying it has more than 150 distribution partners with economic incentives to support USDC and that it can work with Coinbase on additional distribution arrangements when appropriate.

Circle said USDC held on Coinbase’s platform represented 30% of total circulation at quarter-end. Hyperliquid accounted for roughly 6% of that total, according to Fox-Geen. The company said its new arrangement with Hyperliquid had minimal second-quarter financial impact because the migration to Coinbase’s platform occurred late in the quarter, with effects expected to begin appearing in the third quarter.

Arc Mainnet Set for September Launch

Circle said its Arc Mainnet is scheduled to launch Sept. 16. The company described Arc as financial-market infrastructure designed for institutions and said more than 100 partners were active on its private mainnet ahead of the public release. Arc’s testnet had processed more than 500 million transactions across nearly 3 million wallets, Allaire said.

The company announced partnerships with DTCC and BlackRock related to the network. DTCC is collaborating with Circle on tokenized securities, initially focused on enabling tokenization of DTC-custodied assets on Arc. BlackRock plans to deploy its BUIDL fund on Arc, where Circle said native USDC integration could allow institutional investors to subscribe, redeem and deploy fund assets in one on-chain environment.

Circle also said it received final approval for an OCC national trust bank charter and later received a limited-purpose trust charter from New York state. Allaire said Circle National Trust will provide a federally supervised foundation for digital-asset services and allow core USDC infrastructure to operate within that framework.

Payments and Product Expansion

Circle Payments Network, or CPN, reached nearly $15 billion in annualized total payment volume on a trailing 30-day basis at the end of the second quarter. The company said the figure rose to $23 billion as of July 31, representing 130% growth since its prior earnings report.

CPN had 175 financial institutions at quarter-end, up nearly 30% sequentially, and its products were operating across more than 58 countries, Circle said. Allaire said Circle expects to begin monetizing the payments network in the second half of the year.

The company also highlighted growth in other digital assets. EURC increased 2.2 times year over year, while USYC, Circle’s tokenized money market fund, grew tenfold to more than $3 billion in assets, according to Allaire.

Circle said it is also investing in agentic-finance tools, including its Agent Stack and support for the x402 payment protocol. Allaire said USDC, alongside protocols including x402, handles 99.3% of agentic payments, and that more than 900 paid services were available in the company’s agent marketplace.

Updated Outlook

Fox-Geen raised Circle’s 2026 other-revenue outlook to between $310 million and $330 million, from a prior range of $150 million to $170 million. The revision was driven primarily by Arc-related revenue.

Circle said it completed a $242 million presale of the ARC Token during the second quarter and expects to recognize revenue as product milestones are achieved. Based on its roadmap, the company expects to complete about 75% of those milestones during 2026, contributing approximately $180 million to revised guidance. The remaining products are expected to generate $130 million to $150 million in other revenue.

The company raised its full-year revenue-less-distribution-cost margin outlook to 41.7% to 43.7%, from 38% to 40%. It maintained adjusted operating expense guidance of $570 million to $585 million, though Fox-Geen said Circle expects results near the upper end of that range.

Circle reiterated its view that a 40% multi-year, through-cycle compound annual growth rate for USDC is achievable. Fox-Geen said the company expects growth to be supported by regulated markets, enterprise adoption, international use cases and broader use of blockchain-based financial infrastructure.

About Circle Internet Group (NYSE:CRCL)

Circle Internet Group NYSE: CRCL is a financial technology company that builds infrastructure to enable businesses and developers to use and move money on public blockchains. Co-founded by Jeremy Allaire and Sean Neville, the company is best known as a principal issuer and steward of USDC, a dollar-pegged stablecoin developed through the CENTRE Consortium, which Circle co-founded with Coinbase. Jeremy Allaire serves as CEO and has been a visible leader in the company’s strategy and public engagement around digital currency and payments innovation.

Circle’s core products and services center on digital currency issuance and programmable payments.

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