Circle Internet Group reduced its workforce by approximately 5% in the third quarter, a move the USDC issuer disclosed in footnotes to earnings results showing revenue climbed 17% to $865 million and net income rose 5% to $226 million.
The company booked a $9.1 million restructuring charge in Q3 2026 covering notice-period pay, severance, and benefits. Circle described the reduction as “designed to better align our organizational structure with our operating model and strategic priorities.”
Revenue Growth Masks Reserve Pressure
The headline revenue figures obscure underlying strain in Circle’s core business. Reserve income, which the company earns on Treasuries and cash backing USDC, fell 8% year-over-year to $658 million despite average USDC in circulation growing 8% to $73.3 billion. The reserve return rate declined 61 basis points to 3.5%, reflecting lower yields on backing assets.
Stripping out a one-time $182 million ARC token presale revenue, total revenue would have declined year-over-year. Other revenue, excluding reserves and the token sale, reached $207 million, up from $29 million in the prior year, driven by distribution and Arc-related activity. Adjusted EBITDA rose 85% to $317 million, while operating expenses increased 16% to $245 million and distribution costs fell 8% to $409 million.
Arc Mainnet Launch and Market Position
Circle launched Arc, its own layer-one blockchain, on September 16, 2026, with over 100 institutional builders participating at launch. The company minted the full 10 billion ARC token supply and became the first public company to issue a network token for its own layer-one chain.
Circle’s market share in fiat-backed stablecoins stands at 27%. USDC circulation reached $73.9 billion at quarter-end, flat year-over-year despite the 8% growth in average circulation during the quarter.
Tazapay Acquisition and Binance Partnership
Circle agreed to acquire Tazapay, a Singapore cross-border payments platform with over $25 billion in annualized volume, with the deal expected to close in 2027. Binance invested $100 million in Circle equity and renewed a USDC distribution partnership. Days after renewing the partnership, Binance suffered a $6.34 billion hack.
Regulatory Outlook
The GENIUS Act, which brings federal licensing and reserve rules for stablecoin issuers, takes effect January 18, 2027. Circle has stated its stablecoins will qualify under the new regime.
