Circle Beats on Profit, Misses Revenue
Circle Internet’s second-quarter results delivered a mixed message to investors. The company posted adjusted earnings of 18 cents per share, surpassing analysts’ consensus estimate of 16 cents. Net income from continuing operations reached $48 million, outpacing the projected $43 million and marking a sharp year-on-year increase of $530 million. However, revenue for the quarter came in at $701 million, falling short of Wall Street’s average expectation of $713.32 million. Adjusted EBITDA also improved by 8% to $143 million, but the revenue miss overshadowed these gains in the eyes of many market watchers.
On Wednesday morning, Circle shares initially rose 5.7% in pre-market trading to above $66.50, but the stock remains down roughly 20% for the year—underscoring persistent investor skepticism despite solid profit metrics.
USDC Circulation Up, Stock Slides
USDC, Circle’s flagship stablecoin pegged 1:1 to the U.S. dollar, saw its circulation reach $73.3 billion at the end of June—a 19% increase from a year earlier. This growth was accompanied by a surge in onchain transaction volume for USDC, which jumped 151% to $14.8 trillion during the quarter.
USDC circulation, while up from last June, remains below its 2026 peak of nearly $80 billion.
Yet these robust usage figures were not enough to buoy Circle’s share price in the wake of its earnings release.On paper, USDC’s rising adoption signals strong underlying demand; but Circle’s shares still fell about 3% in premarket trading after earnings hit the wire. The disconnect points to broader market concerns about competition and future revenue streams.
It’s unclear if sustained USDC growth alone will be sufficient to reverse the stock’s downward trend.
Open USD Sends Shares Tumbling
The recent launch of Open USD (OUSD), an open-source stablecoin standard backed by over 140 partners—including heavyweights like Coinbase, Visa, and Mastercard—added another layer of uncertainty for Circle investors. The announcement triggered a sharp selloff that wiped billions off Circle’s market value and sent shares tumbling as much as 20%. While OUSD is not positioned as a direct replacement for USDC, its high-profile support has raised questions about stablecoin market share.
Coinbase CEO Brian Armstrong emphasized that his company is a “multi-stablecoin platform,” supporting not only USDC but also competitors like Tether’s USDT and PayPal’s PYUSD; he described Open USD as creating new business opportunities rather than replacing existing coins.
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Big Backers Stick With USDC
Despite market jitters around Open USD, several major backers have reaffirmed their commitment to USDC and Circle’s ecosystem. Coinbase CFO Alesia Haas confirmed during the Q2 call that Coinbase has renewed its commercial agreement with Circle and plans to continue growing USDC adoption. Meanwhile, Mastercard CEO Michael Miebach stated that Mastercard will enable Open USD across its network but continues to support other stablecoins including USDC and Paxos-led USDG.
Visa CEO Ryan McInerney echoed this multi-stablecoin approach, highlighting Visa’s role in connecting clients to whichever stablecoins gain traction. Visa recently launched its own Stablecoin Platform with OUSD as an initial supported token but maintains ongoing support for USDC transactions as well.
Onchain Volume Surges Amid Market Jitters
Circle’s blockchain ambitions are gaining momentum even as competitive pressures mount. The public mainnet launch for Arc—the company’s new blockchain designed for regulated finance—is slated for September 16. BlackRock, DTCC, Galaxy Digital, ICE, Mastercard, MoneyGram, SBI Group, Standard Chartered, Sumitomo Corporation, and Visa have all signed on as founding validators for Arc.
Reserve income for Q2 climbed 5% year-on-year to $668 million on the back of a 25% increase in average USDC circulation. Looking ahead, Circle has raised its full-year guidance for “other revenue” (which includes Arc token presale proceeds) from a prior range of $150–$170 million up to $310–$330 million—a significant upward revision reflecting expectations around new product launches.
According to cointelegraph.com, net income from continuing operations surged by $530 million compared with last year—a rare bright spot amid otherwise turbulent trading conditions.
What remains unresolved
If the public mainnet launch of Circle’s Arc blockchain, scheduled for September 16 with validators including BlackRock, DTCC, and Visa, proceeds as planned, immediate market reaction will hinge on whether this event drives a reversal in Circle’s year-to-date 20% share price decline and impacts USDC circulation, which stood at $73.3 billion at the end of June; the extent of this effect remains unclear.
