NEW YORK, Feb 25, 2026, 10:14 EST — Regular session
- Circle shares rose more than 20% early Wednesday after a quarterly revenue beat
- USDC circulation climbed 72% to $75.3 billion, boosting reserve income
- Investors are focused on rate sensitivity and rising distribution costs
Circle Internet Group Inc shares jumped more than 20% in early New York trading on Wednesday after the stablecoin issuer topped Wall Street’s fourth-quarter revenue expectations on a surge in USDC circulation. Reuters
The move matters because Circle’s core earnings engine is still tied to interest income on the reserves backing USDC, at a moment when traders are trying to game out the next leg in U.S. rates. Growth in circulation can offset softer yields for a while, but not forever.
It also lands as Washington and overseas regulators keep tightening the rulebook for dollar-pegged tokens, which are designed to hold close to $1 with cash and other low-risk reserves. Circle is one of the first big issuers trying to turn that compliance story into a mainstream payments pitch.
USDC circulation rose 72% from a year earlier to $75.3 billion in the fourth quarter, lifting revenue from reserves to $733 million, Reuters reported. Total revenue and reserve income climbed 77% to $770 million, above analysts’ average estimate of $739 million, according to LSEG data.
“The key takeaway is that USDC continues scaling rapidly,” Seaport Research Partners analyst Jeff Cantwell said, adding that Circle “is becoming increasingly profitable over time.”
Circle invests the cash it takes in for issued tokens in deposits and U.S. Treasuries and keeps the yield, leaving results highly sensitive to Federal Reserve policy. Rate cuts can bite even if token balances keep rising.
A company press release filed with the SEC showed Circle also pointed to a jump in onchain transaction volume tied to USDC, and said adjusted EBITDA rose to $167 million in the quarter. It posted net income from continuing operations of $133 million, while full-year results were hit by stock-based compensation tied to IPO vesting conditions. Sec
Circle also leaned into its “real-world rails” message. It highlighted a Visa settlement expansion, a partnership with Intuit, and a tie-up with prediction market Polymarket, alongside work on its Arc blockchain and Circle Payments Network.
CEO Jeremy Allaire said the quarter marked “another step forward” in building “the infrastructure for an open, programmable internet financial system,” pointing to broader enterprise and public-sector adoption of USDC.
But there are clear pressure points. Distribution, transaction and other costs rose to $461 million in the quarter, the company reported, reflecting higher payments to partners and the expense of pushing USDC into more platforms.
Beyond Circle-specific numbers, investors are watching the next round of U.S. labor data that could swing rate expectations — a direct input to reserve income — with the February employment report due on March 6. Bls
The next major macro marker after that is the Fed’s March 17-18 policy meeting, where officials will again have to balance sticky inflation fears against signs of cooling growth. Federalreserve
