By Steve Gelsi
Circle’s stock surges as investors shrug off a one-time quarterly loss and focus on a big jump in revenue and stablecoins in circulation
Circle Internet’s stock is up after it reported a wider-than-expected loss but beat analysts’ revenue estimates.
Circle Internet Group Inc.’s stock rallied Tuesday, as investors focused on the stablecoin issuer’s stronger-than-expected revenue instead of its loss in its first quarterly earnings update since its blockbuster initial public offering.
Circle’s (CRCL) results impressed Wall Street with a 53% jump in second-quarter revenue and bullish comments on the outlook for stablecoins, which are a type of digital currency pegged one-to-one to the U.S. dollar DXY or another reserve asset.
“We are seeing accelerating interest in building on stablecoins and partnering with Circle across every significant sector of the financial industry,” Circle Chief Executive Jeremy Allaire said in a statement.
The stock was climbing 2.9% in early-afternoon trading at $166.12 a share – roughly double where it closed on its first day of trading on June 5, at $83.23. Circle’s IPO had priced at $31.
Looking ahead, Circle may take aim at “careful and deliberate” acquisitions but Allaire doesn’t expect any big, complex deals at the current time.
“We only want to do things that really fit clearly in that kind of product mandate,” Allaire said. “We’ve got a lot of organic development happening now and we’re excited to deliver on that.”
Circle said circulation of its USDC stablecoin (USDCUSD) was $61.3 billion as of June 30, up 90% from a year ago. Since then, it has increased another 6.4% to $65.2 billion as of Aug. 10.
The company’s second-quarter revenue increased to $658.1 million from $430.03 million a year ago and topped the analyst estimate of $645.7 million.
Circle said it swung to a loss $482.1 million, or $4.48 a share, in its second quarter ending June 30. In the year-ago quarter, it earned $32.92 million, with no common stock outstanding at the time.
Wall Street analysts expected Circle to lose 97 cents a share, according to FactSet data.
The reason why Wall Street appeared not to care so much about the larger-than-expected loss was that it included one-time, noncash charges of $591 million related to its IPO, including $424 million for stock-based compensation related to vesting conditions.
During the quarter, Circle debuted its Circle Payments Network, a product to help financial firms make payments with stablecoins.
It also inked payments alliances Corpay Inc. (CPAY), Fiserv Inc. (FI) and crypto exchange Binance Holdings Ltd.
Circle CEO Allaire said the company has been growing its relationship with Binance, among the largest trading platforms for crypto assets.
“They’ve been a great partner and they’re leaning into both the technology and really driving USDC growth,” Allaire said.
Circle said it’s planning a test launch this fall of Arc, which the company described as an open layer-one blockchain network and a foundation for capital markets, foreign exchange and payments using the USDC stablecoin. It’s planning to formally roll out the service by the end of the year.
“We are at the fulcrum of a massive mainstream embrace of stablecoins in the financial system, and firms are racing to build on this infrastructure,” Allaire said. “Until now, the blockchain infrastructure needed to meet the most intense demands of major financial firms and enterprises has simply not existed.”
-Steve Gelsi
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08-12-25 1330ET
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