Circle Q2 revenue misses Wall Street forecasts

Circle reported $701 million in revenue for the second quarter of fiscal 2026, narrowly missing the $713.32 million Wall Street consensus. The company posted $48 million in net income from continuing operations, a $530 million increase year‑over‑year. Reserve income for the quarter was $668 million, up 5% from the prior year.

Total revenue and reserve income rose 7% year‑over‑year, supported in part by an approximately 25% increase in average USDC circulation. Reserve income made up the largest portion of the quarter’s revenue.

Circle’s shares rose about 5.7% in pre‑market trading to trade above $66.50, though the stock remained down roughly 20% year‑to‑date.

The results were released ahead of the public mainnet launch of Circle’s Arc blockchain, scheduled for Sept. 16. Circle reported more than 100 ecosystem and institutional builders active on Arc before the launch and identified a founding validator cohort that includes BlackRock, DTCC, Galaxy, Global Payments, ICE, Mastercard, MoneyGram, SBI Group, Standard Chartered, Sumitomo Corporation and Visa.

Management raised guidance for several revenue items, increasing its forecast for other revenue for the current fiscal year to $310 million to $330 million from a prior range of $150 million to $170 million. The updated outlook includes expected revenue from Arc token presales that the company plans to recognize in the current fiscal year.

The wider stablecoin market saw supply decline to about $153 billion at the end of June from roughly $156 billion on April 1. USDC had a circulating supply near $72 billion at the end of the quarter, while the largest stablecoin had about $183 billion in circulation.

A spokesperson for institutional technology provider Talos noted that USDC accounted for roughly 72% of adjusted on‑chain transfer volume and moved substantially more transfer volume per dollar of supply than the largest stablecoin.

Circle said the increase in reserve income was primarily driven by higher USDC circulation and the performance of the assets backing the stablecoin. The company added that net income benefited from the rise in reserve income and other operational factors compared with the prior year.

Circle expects activity around the Arc mainnet and associated token presales to contribute to revenue for the remainder of the fiscal year, and the company reflected those expectations in its updated guidance.