Circle’s First Public Earnings Send Shares Soaring 11% on USDC Demand Surge

Circle Internet Group shares surged 11% in pre-market trading on Tuesday following the stablecoin issuer’s first quarterly earnings report as a public company.

The company reported total revenue and reserve income of $658 million, up 53% from the previous year, while posting a net loss of $482 million, primarily due to $591 million in non-cash charges from its June IPO.

USDC supply expanded further to $65.2 billion as of August 10, 2025, representing an additional 6.4% growth since quarter-end and cementing the stablecoin’s 28% market share position.

Circle completed its $1.2 billion initial public offering in June, selling 19.9 million shares at $31 each and generating $583 million in net proceeds after fees.

Strong Operational Metrics Drive Growth Despite IPO-Related Charges

Circle’s underlying business showed robust fundamentals with meaningful wallet addresses growing 68% year-over-year to 5.7 million users across the USDC ecosystem.

Reserve income, the company’s primary revenue driver, climbed 50% to $634 million, while other revenue streams, including subscription services, surged 252% to $24 million.

However, the company’s revenue, less distribution costs margin, compressed 408 basis points to 38% as Circle invested heavily in strategic partnerships and expanded distribution networks.

The reported net loss of $482 million was heavily impacted by $424 million in stock-based compensation from RSU vesting related to the June IPO and $167 million in convertible debt fair value increases tied to share price appreciation.

Adjusted EBITDA also rose 52% to $126 million with a 50% margin, up 463 basis points year-over-year, reflecting strong operational leverage in the core business.

Additionally, Circle’s balance sheet expanded significantly with total assets reaching $64.2 billion versus $45.8 billion at year-end 2024, primarily driven by segregated cash backing stablecoin holders.

Average USDC circulation during the quarter hit $61.0 billion, representing an 86% growth year-over-year as institutional adoption accelerated across major financial platforms.

The company minted $42.2 billion in new USDC during the quarter while redeeming $40.8 billion, which can only be minted that much when net positive demand exists.

Strategic partnerships expanded across major platforms, including Binance, Corpay, FIS, Fiserv, and OKX, collectively reaching over 60 million potential users worldwide.

Circle also announced the launch of Arc, an enterprise-grade Layer-1 blockchain designed specifically for stablecoin finance using USDC as native gas, scheduled for public testnet this fall.

The Arc blockchain features integrated foreign exchange functionality and sub-second settlement capabilities while maintaining EVM compatibility for institutional applications.

“Our goal is to deliver a full-stack platform for the internet financial system,” CEO Jeremy Allaire stated during the earnings announcement.

Institutional Adoption Reflects Broader Digital Asset Market Evolution

Circle’s 86% year-over-year growth in USDC circulation outpaces many traditional payment processing volumes, largely resulting from accelerating mainstream acceptance of stablecoin technology for cross-border transactions and treasury management.

The regulatory environment strengthened further with the passage of the GENIUS Act, which established a federal framework for payment stablecoins and codified the company’s existing compliance practices into law.

Circle has since filed to launch First National Digital Currency Bank through a national trust charter application with the Office of the Comptroller of the Currency.

However, the company faces intensifying competition from both existing stablecoin issuers and emerging yield-bearing digital assets that offer additional returns to holders beyond stability.

Major investment firms have also shown mixed reactions to Circle’s public debut, with ARK Invest selling nearly $100 million in shares over two days while other institutional backers maintain positions.

Wall Street analysts began coverage with mostly positive ratings from Barclays, Bernstein, and Canaccord Genuity, though JPMorgan and Goldman Sachs flagged valuation concerns after the stock’s post-IPO surge.

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