Circle Shares Jump 8% on Strong Q2 Growth and Arc Blockchain Announcement

Circle Internet Group (NYSE: CRCL) posted robust revenue growth in its first quarter as a public company and unveiled plans for Arc blockchain, though net losses widened due to significant non-cash IPO charges.

The shares surged 8% in pre-market trading Wednesday after the company reported 53% revenue growth to $658 million in its second quarter and unveiled Arc, a new Layer-1 blockchain designed for stablecoin finance, marking a pivotal expansion of the digital payments firm's technology infrastructure.

Two Major Developments Drive Results

Arc Blockchain Launch

Circle announced Arc, an open Layer-1 blockchain built specifically for stablecoin finance. The EVM-compatible network features USDC as native gas, integrated FX capabilities, and sub-second settlement finality. The blockchain also includes opt-in privacy controls and is designed to provide an enterprise-grade foundation for stablecoin payments, FX, and capital markets applications. Arc launches in public testnet this fall, positioning Circle to control its entire technology stack while maintaining full interoperability with dozens of existing partner blockchains.

According to the statement, Arc represents "a defining moment in our journey for Circle to deliver a full-stack platform for the internet financial system."

Strong Financial Performance Despite IPO Charges

Circle delivered impressive financial growth with USDC circulation increasing 90% year-over-year to $61.3 billion by quarter end. As of August 10, 2025, circulation has grown an additional 6.4% to $65.2 billion. Total revenue and reserve income surged 53% to $658 million, driven primarily by an 86% growth in average USDC circulation.

The company reported a net loss of $482 million primarily due to $591 million in IPO-related non-cash charges, including $424 million in stock-based compensation related to RSU vesting conditions met by the IPO and $167 million from increased convertible debt fair value tied to rising share prices.

Excluding these charges, adjusted EBITDA grew 52% to $126 million, demonstrating strong underlying operational performance with an adjusted EBITDA margin of 50%.

Strategic Milestones

Successful IPO and Regulatory Progress

Circle completed its $1.2 billion IPO in June, with the company selling 19.9 million newly issued primary shares at $31 per share, resulting in net proceeds of $583 million after underwriting discounts and before offering costs of $12.8 million.

The GENIUS Act becoming law marks a historic step for U.S. digital asset regulation by establishing a federal regulatory regime for payment stablecoins. This legislation largely codifies Circle's long-standing compliance practices and strengthens its position as the leading regulated stablecoin issuer.

Circle Payments Network Momentum

Circle launched its Payments Network (CPN) in May, which has already established four active payment corridors and shows strong early momentum with over 100 financial institutions in the pipeline. The platform enables financial institutions to use stablecoins for payments, with planned expansion of payment corridors and enterprise-focused capabilities in the second half of 2025.

Strategic Partnership Expansion

The company expanded partnerships with major financial and technology players:

• Binance: Deepened collaboration to include broader adoption of Circle Wallets technology, and added USYC as a yield-bearing, off-exchange collateral option for Binance’s institutional trading products.

• Corpay: Integrated Corpay’s global FX and card network with USDC, enabling 24/7 settlement.

• FIS: Enabling U.S. financial institutions to offer domestic and cross-border USDC payments via FIS' Money Movement Hub.

• Fiserv: Exploring integration of Circle’s USDC infrastructure and Circle Payments Network with Fiserv’s digital banking and payment solutions.

• OKX: Offering seamless 1:1 USD to USDC conversions, expanding access to over 60 million global users

Technology Innovation

In July, Circle introduced Circle Gateway on testnet, delivering sub-second access to USDC across supported blockchains without the need for bridging, rebalancing, or prepositioning capital. This unified USDC balance system represents a significant advancement in crosschain liquidity management.

Forward Outlook

Management projects strong continued growth with the following guidance:

• USDC circulation expected to grow at a 40% compound annual growth rate through the cycle

• Fiscal 2025 other revenue projected at $75-85 million

• Revenue Less Distribution Costs (RLDC) margin expected at 36-38% for fiscal 2025

• Adjusted operating expenses guided at $475-490 million for fiscal 2025

Stock Performance

Circle Internet Group (NYSE: CRCL) closed at $161.17 on Tuesday, up 1.35% (+$2.14). In pre-market trading, the stock price jumped to $173.90, a gain of 8%, reflecting investor enthusiasm for the strong Q2 results and the Arc blockchain announcement.

About Circle

Circle is a global financial technology firm that enables businesses of all sizes to harness the power of digital currencies and public blockchains for payments, commerce and financial applications worldwide. The company issues USDC and EURC stablecoins through its regulated affiliates and provides a comprehensive suite of financial and technology services for enterprises and developers to integrate stablecoins and blockchains into their operations.