Circle Reports 66% Revenue Growth in Q3 as USDC Circulation Surges Past $73B

Circle Internet Group reported third-quarter revenue and reserve income of $740 million, up 66% year-over-year, as circulation of its USDC stablecoin more than doubled to $73.7 billion, according to results released Wednesday.

The New York-based company posted net income of $214 million for the quarter ended September 30, a 202% increase from the prior year, while adjusted EBITDA grew 78% to $166 million. USDC circulation climbed 108% year-over-year, driving the majority of the company's revenue growth.

Reserve income, generated from yields on the cash and short-term U.S. Treasuries backing USDC, totaled $711 million, up 60% from a year earlier. The growth reflected a 97% increase in average USDC circulation, partially offset by a 96 basis point decline in reserve return rates.

"Circle continued to see accelerating adoption of USDC and our platform in the third quarter as we build the new Economic OS for the internet," said Jeremy Allaire, co-founder and CEO. "As digital dollars become integrated with the technological utility of the internet, Circle's infrastructure is helping global finance move with greater trust, transparency and velocity."

The company's other revenue streams, including subscription services and transaction fees, jumped to $29 million from $1 million a year earlier, reflecting growing commercial activity beyond stablecoin issuance.

Operating expenses climbed 70% to $211 million, driven largely by $59 million in stock-based compensation during the quarter. Adjusted operating expenses rose 35% to $131 million, primarily from higher cash compensation tied to 14% headcount growth.

Distribution and transaction costs increased 74% to $448 million, reflecting higher payments to partners including Coinbase as USDC circulation expanded across platforms.

Circle's net income benefited from a $61 million income tax credit related to stock-based compensation, research and development tax credits, and recent U.S. tax legislation. Results also included a $48 million gain from decreased fair value of convertible debt tied to the company's lower stock price during the quarter.

The company announced several strategic developments during the period, including the October 28 launch of Arc's public testnet with over 100 participating companies. Arc is Circle's layer-1 blockchain designed to support programmable financial infrastructure. Circle said it is exploring launching a native token on the Arc network to drive adoption and align stakeholder interests.

Circle's payments network, launched in late May, now supports flows across eight countries with 29 enrolled financial institutions, 55 under review, and 500 in the pipeline. Annualized transaction volume based on trailing 30-day activity reached $3.4 billion as of November 7.

The company also disclosed that USYC, its tokenized money market fund, grew over 200% since June 30 to approximately $1 billion as of November 8.

New partnerships announced since the second quarter include collaborations with Brex, Deutsche Börse Group, Finastra, Fireblocks, Hyperliquid, Kraken, Unibanco Itaú, and Visa.

For the full fiscal year, Circle raised its other revenue guidance to $90-100 million from previous estimates, citing stronger subscription and transaction revenue. The company expects reserve and liquidity distribution cost margins of approximately 38% and raised adjusted operating expense guidance to $495-510 million to reflect increased platform investment.