NEW YORK, Feb 25, 2026, 10:14 EST — Regular session
- Circle shares jumped over 20% early Wednesday, following a quarterly revenue beat.
- USDC’s circulation shot up 72% to $75.3 billion, delivering a lift to reserve income.
- Rate sensitivity and higher distribution costs have investors’ attention right now.
Circle Internet Group Inc surged over 20% at the open in New York this Wednesday. The stablecoin company beat analysts’ Q4 revenue forecasts, driven by a sharp rise in USDC in circulation.
This shift is significant—Circle still leans on interest from USDC reserves as its main revenue source, and right now, traders are parsing what’s next for U.S. rates. For now, more USDC in circulation can help make up for weaker yields, though that cushion won’t last indefinitely.
This comes as regulators in Washington and abroad continue to clamp down on dollar-pegged tokens—these are meant to stay near $1, backed by cash and similar low-risk reserves. Circle, among the larger issuers, is pushing to flip that compliance angle into a broader payments pitch aimed at the mainstream.
USDC circulation jumped 72% year-over-year, hitting $75.3 billion in the fourth quarter and pushing reserve revenue up to $733 million, Reuters said. Total revenue and reserve income together reached $770 million, a 77% increase and ahead of the $739 million consensus from analysts polled by LSEG.
Seaport Research Partners analyst Jeff Cantwell said USDC is scaling fast, calling that the “key takeaway.” He also noted Circle “is becoming increasingly profitable over time.”
Circle parks the cash from issued tokens in deposits and U.S. Treasuries, pocketing the yield—a setup that’s tightly linked to what the Federal Reserve does with rates. If the Fed trims rates, earnings can take a hit, even if token balances are still climbing.
Circle cited a surge in USDC-linked onchain transaction volume in an SEC filing, while adjusted EBITDA climbed to $167 million for the quarter. Net income from continuing operations was $133 million. Stock-based compensation tied to IPO vesting weighed on full-year numbers.
Circle kept pushing its “real-world rails” pitch, emphasizing a broader Visa settlement rollout, a new partnership with Intuit, and its move to work with prediction market Polymarket. The company also pointed to ongoing efforts around its Arc blockchain and the Circle Payments Network.
CEO Jeremy Allaire called the quarter “another step forward” as the company pushes toward “the infrastructure for an open, programmable internet financial system.” He flagged increased USDC uptake across both enterprise and public sector channels.
Still, pressure points are showing. The company said distribution, transaction, and related costs climbed to $461 million for the quarter—higher partner payouts and the push to expand USDC across more platforms drove that increase.
Investors are also eyeing the February jobs report, set for March 6, as fresh U.S. labor data could quickly shift rate outlooks and, in turn, reserve income. Circle’s details aside, that employment print has their attention.
Next up on the macro calendar: the Fed’s policy meeting set for March 17-18. Officials there will be weighing persistent inflation worries against indicators that growth may be losing steam.
