Circle Internet Group (NYSE: CRCL) delivered a strong third quarter in 2025, reporting $740 million in combined revenue and reserve income – a 66 % increase compared with the same period a year ago. The results were driven primarily by the rapid growth of the company’s stablecoin business, backed by the fiat- and Treasury-supported USDC.
At quarter end, USDC circulation reached $73.7 billion, more than double (up 108 %) the level a year prior. Many observers view this as a meaningful inflection point in the firm’s stablecoin franchise, which now commands roughly 29 % of the dollar-backed stablecoin market.
Growth Engines and Platform Ambitions
CEO and co-founder Jeremy Allaire said the quarter reflects “accelerating adoption of USDC and our platform” as Circle lays the groundwork for what it calls the “new Economic OS for the internet.”
A major highlight was the launch of the public testnet for Circle’s Arc layer-1 blockchain in October, which enlisted over 100 institutions including major banks, asset managers, payments firms and crypto exchanges. Circle is also exploring the possibility of launching a native Arc token.
In addition to its stablecoin business, Circle’s subsidiary operations show broader traction: the Circle Payments Network (CPN) now includes 29 enrolled financial institutions with 55 additional in eligibility review and 500 in the pipeline. These developments reflect Circle’s push into global payments, merchant flows and institutional finance.
Margin Trends, Costs and Market Reaction
While top-line growth was robust, some metrics point to rising pressure. The company noted that the RLDC margin (“revenue less distribution costs”) fell modestly to 39 %, down approximately 270 basis points year-on-year, due to higher distribution and transaction costs tied to expanding USDC balances.
Operating expenses also increased materially, with the 2025 revised guidance placing adjusted operating expenses in the range of $495-$510 million, up from earlier estimates.
Despite strong fundamentals, Circle’s stock traded lower in pre-market sessions, as investors weighed the valuation, rising cost base and sensitivity to interest-rate movements. Analysts remain split: some bullish on stablecoin dominance and platform build-out, others cautious about margin erosion and regulatory risks.
Outlook and Strategy Beyond Q3
Looking ahead, Circle raised its 2025 “Other Revenue” guidance to $90-$100 million (from earlier $75-$85 million), while reaffirming its long-term objective for USDC growth at a multi-year annualised rate above 40 %.
However, the company acknowledges external risks – most notably a potential decline in short-term interest rates which could compress reserve income, a major revenue driver derived from backing USDC with high-quality liquid assets.
Circle is betting the business will evolve from stablecoin issuance toward a broader ecosystem role: programmable money, institutional rails, and blockchain infrastructure underpinning global finance. If Arc and partner integrations scale as hoped, Circle aims to shift from pure reserve-income dependence toward a diversified platform model.