Circle Q3 Earnings Beat, Costs Raise Outlook
Circle Q3 earnings showed strong revenue and USDC growth, but Circle raised FY adjusted operating-expense guidance, shifting trader focus to margins.
KEY TAKEAWAYS
- Circle beat Q3 EPS expectations, reporting $0.64 versus $0.22 consensus.
- USDC circulation reached $73.7 billion, boosting reserve income and lifting total revenue to $740 million.
- Circle raised FY adjusted operating-expense guidance to $495-$510 million, refocusing investors on margin pressure.
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Circle Internet Group, Inc. (NYSE: CRCL) reported third-quarter results on Nov. 12, 2025. The company beat earnings estimates after strong growth in USDC stablecoin circulation but raised full-year adjusted operating-expense guidance, a move that coincided with a decline in its stock.
Revenue Growth Driven by USDC Circulation
For the quarter ended Sept. 30, 2025, Circle reported total revenue and reserve income of $740 million, a 66% increase year-over-year. Reserve income accounted for $711 million, while other revenue rose to $29 million, up $28 million from the prior year. USDC circulation reached $73.7 billion at quarter end, up 108% year-over-year. Net income rose 202% to $214 million, and adjusted EBITDA, a proxy for operating profit, increased 78% to $166 million. Earnings per share came in at $0.64, surpassing the $0.22 consensus estimate.
Rising Costs and Updated Guidance
Operating expenses totaled $211 million, up 70% year-over-year, including $59 million in stock-based compensation. Adjusted operating expenses increased 35% to $131 million. Distribution, transaction, and other costs rose 74% to $448 million.
Circle raised its full-year adjusted operating-expense guidance to a range of $495 million to $510 million. The company attributed the increase to growing investment in its platform, capabilities, and global partnerships, as well as higher payroll taxes expected from option exercises. It also raised its other-revenue outlook to $90 million to $100 million and expects its RLDC margin to be about 38%.
The quarter included a $61 million income-tax benefit related to stock-based compensation, research and development credits, and recent U.S. tax legislation. A $48 million convertible-debt benefit reflected a lower fair-value adjustment tied to the company’s share price.
Strong revenue and profit gains were offset by higher near-term spending and margin pressure following the revised expense outlook, shifting investor focus despite the earnings beat.
