Circle Q3 Revenue Rises 17% to $865M as USDC Reserve Income Falls 8%

Circle Internet Group reported $865 million in total revenue and reserve income for the third quarter of 2026, up 17% year over year, with net income from continuing operations of $226 million, according to its quarterly filing with the U.S. Securities and Exchange Commission . One line down sits the number that carries the business: reserve income, the money Circle earns on the $73.3 billion of USDC it parks in Treasuries and money-market assets, fell 8% to $658 million.

The spread between those two figures is the story. Circle’s Q3 growth was driven by a single non-recurring line, a $182 million presale of its ARC token, which lifted other revenue 627% to $207 million. Subtract the presale and total revenue lands near $683 million, below the $740 million Circle booked in the third quarter of 2025.

Reserve income fell even as circulation climbed

Reserve income of $658 million compared with $711 million a year earlier, the filing shows. The decline came from a 61-basis-point drop in Circle’s reserve return rate, to 3.5%, which outweighed an 8% increase in average USDC in circulation to $73.3 billion. More stablecoins in the market, but each dollar of them earning less for Circle.

Volume told the opposite story. USDC onchain transaction volume reached $13.9 trillion in the quarter, up 49% year over year. Against $73.3 billion in average circulation, that implies each USDC turned over roughly 190 times during the quarter, or about twice a day, a pace that signals payments and settlement use rather than idle holdings.

The flow data points the same direction. Circle minted $104 billion of USDC in Q3, up 31%, while redemptions rose 54% to $104 billion. And Circle’s share of the dollar-stablecoin market slipped to 27%, down 183 basis points from a year earlier, even as its meaningful wallets, onchain addresses holding more than $10 of USDC, grew 16% to 7.3 million.

A $182 million presale did the heavy lifting

Other revenue of $207 million was up 627% year over year, and $182 million of it came from the ARC token presale. That single line is 88% of the other-revenue bucket and, more importantly, the difference between growth and contraction at the top line. Without it, revenue would have fallen about 7.7% from the prior-year quarter.

Circle’s own guidance makes the point that the presale is not a steady state. The company told investors to expect other revenue of $310 million to $330 million for the full year 2026, a range that already includes the recognized ARC presale, with the full figures posted to its investor relations site . Even the net income margin fell 285 basis points to 26%, so each revenue dollar produced less profit than a year ago.

Arc mainnet is live with 10 billion ARC tokens

Circle launched the Arc public mainnet on September 16, with more than 100 institutional and ecosystem builders on day one, native USDC integration, and a founding validator cohort drawn from institutions that run global finance, the filing states. Circle also completed the genesis mint of ARC, a full initial supply of 10 billion tokens, making it the first publicly traded company to mint a network token for a new layer-one blockchain.

ARC is designed as the coordination mechanism for security, utility and governance on Arc as the network moves toward a proof-of-stake transition in 2027. The developer base is already measured in the tens of thousands: more than 75,000 Arc House members and 10,000 Architect ambassadors, who built over 1,200 projects during the private mainnet.

“We also launched Arc on public mainnet with more than 100 institutional and ecosystem builders, giving them the infrastructure to build the next generation of financial applications,” said Jeremy Allaire, Circle’s co-founder, CEO and chairman. “Together, we’re building the financial and economic infrastructure for the internet, and upgrading the system for a world where people, businesses, and AI agents all transact onchain.”

Binance, Visa, SAP and Samsung signed on

The quarter’s deal list reads like a who’s-who of payment rails. Binance made a $100 million equity investment in Circle and renewed and expanded its strategic partnership to promote USDC across its global platform, with an emphasis on emerging markets. Visa moved its Visa Direct stablecoin prefunding from pilots to commercial deployment, enabling clients to fund cross-border payouts in near real time across more than 180 countries.

Tereina, a SAP-backed company, is integrating USDC and EURC into its payments infrastructure, targeting the SAP ecosystem that underpins 84% of global commerce. Samsung Wallet began letting eligible Galaxy users in the U.S. send money via USDC to bank accounts in more than 60 countries. Circle also signed a definitive agreement to acquire Tazapay, a Singapore-based B2B cross-border payments platform that brings more than $25 billion in annualized payment volume, over 60 banking and fintech partners, and local payout rails covering 100-plus markets. The deal is expected to close in 2027, pending regulatory approvals.

“In Q3, we saw continued proof that institutions are building and expanding on USDC. Tereina is bringing USDC and EURC into the SAP ecosystem, Visa took stablecoin prefunding into commercial deployment, and Binance renewed and expanded our partnership,” Allaire said.

A 5% workforce cut next to 85% EBITDA growth

Circle reduced its workforce by about 5% during the quarter to better align its structure with its operating model, recording roughly $9.15 million in restructuring charges, mostly severance and related costs. The cut sits next to an adjusted EBITDA figure of $317 million, up 85% year over year.

The two numbers are not as contradictory as they look. Adjusted EBITDA, a non-GAAP measure, counts the $182 million presale as revenue and benefits from distribution costs that fell 8%. Operating expenses, meanwhile, rose 16% to $245 million on higher general and administrative, IT infrastructure and marketing spend. The margin expansion Circle reports is a mix of cost discipline and one-time revenue, not a step change in the underlying stablecoin economics.

What the filing leaves open

Circle’s own risk disclosures frame what could go wrong with the ARC strategy. The filing flags legal and regulatory uncertainty around the token, including whether ARC could be treated as a security, and warns of possible repayment obligations if key launch milestones are not achieved, language that echoes the conditional nature of a presale. The Tazapay deal, too, is contingent on regulatory approval and a 2027 close.

The near-term test is the reserve return rate. Circle’s core income depends on short-term interest rates on the assets backing USDC, and a 61-basis-point decline in that rate this quarter is what turned volume growth into an income decline. The company’s prior results, which showed $1.4 billion in first-half revenue while paying 59% of it to USDC partners , make the same point: distribution economics and rates, not just circulation, decide how much of that revenue Circle keeps.

The next observable signals are concrete: the Q4 reserve return rate, whether full-year other revenue lands inside the $310 million to $330 million guide, the ARC proof-of-stake transition targeted for 2027, and the Tazapay closing. Until then, the headline 17% growth carries an asterisk, because the fastest-growing line in the quarter was a token presale, not the stablecoin business it is meant to fund.