Circle swung to a $48 million profit as USDC in circulation grew 25%

Circle Internet Group, the issuer of the USDC stablecoin, reported total revenue and reserve income of $701.3 million for the second quarter of 2026, with reserve income — the interest earned on the reserves backing USDC — accounting for $667.7 million of that, up 5% from a year earlier. The company posted net income of $48.2 million, a sharp reversal from the $482.1 million net loss it recorded in the second quarter of 2025, a swing driven largely by the absence of the heavy stock-based compensation tied to Circle’s 2025 initial public offering.

The more structurally important number is average USDC in circulation, which grew 25% year over year to $76.5 billion. That growth came even as the reserve return rate — effectively the yield Circle earns on the short-term treasuries and cash backing each USDC token — declined 66 basis points to 3.5%, a byproduct of the broader interest-rate environment. Circle’s reserve income model means more stablecoin in circulation helps revenue, but a falling rate environment works against it, and this quarter’s revenue growth shows circulation growth outpacing the rate headwind.

Circle also disclosed that Arc, its layer-1 blockchain network built for financial institutions and enterprises, has a public mainnet launch scheduled for September 16, 2026. Arc represents Circle’s attempt to move beyond being purely a stablecoin issuer into providing settlement infrastructure that other institutions build on directly — a strategic extension that, if adopted, could diversify revenue beyond reserve interest over time.

On regulation, Circle noted that while the GENIUS Act has passed and amends federal securities law to explicitly exclude payment stablecoins from the definition of a security, the company is continuing to rely on its prior legal position that USDC is not a security until those amendments formally take effect — a reminder that even with favorable legislation passed, implementation timing still matters for how a company represents its own compliance posture. Taken together, a return to profitability, accelerating circulation growth, and a new network launch mark a notably stronger quarter than the one Circle reported a year ago as a newly public company.