CRCL

Download the Complete Report Here Key Takeaways: Houdini materially changes the earnings mix and marks the clearest step yet in STKE’s evolution toward a broader blockchain infrastructure platform. STKE reported C$1.79 million of operating revenue in 3Q FY26 (quarter ending June 30, 2026), down 41% from C$3.04 million in the prior-year quarter, but the composition of revenue changed materially following the June 1 closing of Houdini. Swap aggregator fees contributed C$1.17 million from only one month of ownership, representing approximately 65% of quarterly operating revenue, while combined staking and validation income fell to C$622,000 from C$3.04 million y/y. Houdini also contributed C$768,000 of EBITDA, implying a 66% EBITDA margin, while the call separately referenced approximately C$685,000 of operating income and a margin of roughly 60%. We believe the quarter provides tangible evidence that STKE can add SOL-price-independent transaction revenue alongside validator infrastructure and a productive SOL treasury, broadening the earnings model within its core blockchain infrastructure strategy. STKE is increasingly organized around three interconnected value engines, validator infrastructure, privacy and cross-chain technology, and a productive SOL treasury, with each reinforcing the broader blockchain infrastructure platform. The validator business monetizes third-party SOL through staking commissions, MEV, and transaction fees without requiring STKE to own the delegated assets, creating a balance-sheet-light recurring revenue engine. The owned treasury adds a second layer by generating staking yield while also providing productive collateral that can support strategic financing and infrastructure expansion. Houdini and Zyga extend the model into privacy, cross-chain execution, transaction routing, and transaction and software-driven revenue across 120+ blockchain networks, with more than 50% of Houdini’s trailing transaction volume touching Solana. Together, the model increasingly combines infrastructure, treasury, and privacy technology that can compound through different but complementary economic channels, broadening STKE beyond a single-chain or token-price-dependent earnings model. Lower protocol issuance is accelerating the shift toward AuD, MEV and transaction-driven validator monetization. Staking income fell 59% y/y to C$530,000 from C$1.29 million, while validation service income declined 95% to approximately C$92,000 from C$1.75 million, taking combined income to C$622,000 versus C$3.04 million in 3Q FY25 and approximately C$1.15 million in 2Q FY26. Importantly, gross validator rewards fell to 2,531 SOL from 8,789 SOL y/y, while staking rewards declined to 4,295 SOL from 6,271 SOL. After 375 SOL of validator fees, net validator income was 2,156 SOL, taking total staking and validating income to 6,451 SOL versus 15,060 SOL a year ago, down 57%. This marks a change from 2Q, when weaker CAD revenue primarily reflected SOL-price pressure despite more resilient token-denominated generation. With Solana disinflation reducing issuance and network competition pressuring validator commissions, recovery increasingly depends on AuD, transaction activity, MEV capture, and monetization per delegated SOL rather than token price alone. We believe Houdini’s first month provides encouraging initial validation of the strategic rationale behind the acquisition and immediately adds a high-margin second operating engine. Houdini generated C$1.2 million of revenue and C$685,531 of operating income during June, implying a reported operating margin of ~59%. Management characterized the result as roughly 60% operating margin and 66% EBITDA margin, while noting that the first month was in line with expectations and that the June run-rate would imply a less-than-three-year payback on the acquisition before any future growth. Importantly, management also indicated that the September quarter was looking promising and that integration had been seamless to date, making 4Q FY26 the first period in which we will see three full months of Houdini inside consolidated results. Strong validator performance and embedded distribution provide a foundation to rebuild AuD and expand monetization per SOL. Assets under Delegation ended June at 3.4 million SOL, or ~C$355 million, down ~11% from 3.8 million SOL at March quarter-end and 8% from 3.74 million SOL a year ago, while STKE continued to serve 33,000+ unique wallets and maintained 100% validator uptime. Orangefin generated a 5.84% average APY in June versus the Solana network average of 5.53%, a 31 bps advantage, while the Seeker validator alone had attracted 27,000+ wallets. Together with STKE’s role as sole staking provider to the VanEck Solana ETF, these embedded and institutional channels provide balance-sheet-light routes to stabilize and rebuild delegation after AuD declined from more than 4.0 million SOL earlier in FY26. The owned treasury remains a productive third value engine, generating recurring staking yield while providing strategic balance-sheet flexibility. As of June 30, 2026, STKE held 459,792 SOL, more than 4.5x the 100,746 SOL held around its FY24 pivot, alongside additional STKESOL and JTO positions. Approximately 205,620 SOL was staked directly to company-operated validators at quarter-end, with management indicating the owned treasury earns approximately 6% annual staking rewards. This creates a recurring yield stream independent of third-party delegation growth while retaining upside to SOL appreciation and providing productive collateral that can be deployed for strategic financing. The distinction is increasingly important as STKE broadens into Houdini: the treasury can continue compounding in SOL units while transaction infrastructure provides a separate cash-earnings engine, with the two supporting different but complementary sources of value creation. A key shift within the validator stack is from issuance-driven rewards toward transaction and liquid-staking economics. STKE’s infrastructure processes more than 1 million transactions per day, creating monetization opportunities through commissions, MEV and transaction fees as protocol emissions decline; during 3Q, the company began deploying Jito’s block assembly marketplace on two nodes to improve participation in transaction-driven economics. SIMD-0550 proposes faster Solana disinflation, while SIMD-0553 would introduce resource-based transaction fees tied more directly to network compute usage, potentially accelerating this shift. STKE indicated support for both proposals and said it intends to vote accordingly, viewing the changes as constructive for Solana’s longer-term economics despite the near-term pressure faster disinflation could place on staking rewards. STKESOL adds a separate fee-bearing layer, ending June with ~646,000 SOL across 1,300+ wallets versus ~768,000 SOL at March quarter-end, down ~16% q/q but still above the 500,000+ SOL deposited at launch. The product distributes stake across roughly 75 validators and allows STKE to earn a share of pooled staking rewards without owning the underlying SOL. As protocol issuance declines, growth in validator monetization should increasingly depend on AuD, MEV, transaction fees and STKESOL activity rather than token rewards alone. Zyga adds a proprietary technology layer that STKE can now potentially commercialize through Houdini’s existing distribution. STKE acquired substantially all of Darklake’s assets and core development team in April, including Zyga, a proprietary zero-knowledge proving system developed from technology that placed second in the DeFi track of the Colosseum Global Radar Hackathon among 1,300+ submissions. Zyga is designed to enable private, MEV-resistant execution and confidential on-chain workflows, with the team now evaluating applications across Houdini’s retail and B2B ecosystem. Houdini gives the technology an existing distribution base across wallets, exchanges and transaction flow rather than requiring standalone customer acquisition; successful integration could improve product differentiation, monetization per transaction and margins. Treasury-backed financing preserved SOL exposure while providing acquisition capital without liquidating core holdings. STKE financed Houdini’s cash consideration through Solana-based DeFi rather than selling SOL, with 252,851 SOL worth approximately C$26.4 million pledged to Kamino at June 30 against C$13.9 million of borrowings. The facility carried an approximately 3% variable rate and a 75% liquidation threshold, while pledged assets continued generating staking yield. At quarter-end, STKE had C$1.9 million of cash and C$37.3 million of current liabilities, but also C$48.3 million of digital assets, including roughly C$22 million of unencumbered assets available for liquidity. This approach preserved SOL exposure and avoided crystallizing a sale during weak market conditions, but increased the sensitivity of liquidity and collateral coverage to token prices ahead of the $5.75 million Houdini seller-note payment due December 1. Noncash charges mask a significantly narrower underlying EBITDA deficit, with Houdini beginning to demonstrate operating leverage. Effective June 1, STKE ceased qualifying as an investment entity under IFRS 10 and began consolidating controlled subsidiaries, including Houdini, making 3Q both an economic and reporting transition. STKE reported a C$17.6 million net loss, or C$0.49 per share, versus C$8.2 million, or C$0.40, y/y, including C$5.43 million of digital-asset revaluation losses, C$4.00 million of impairment, C$1.81 million of amortization, and C$1.30 million of share-based compensation. Management characterized more than C$15 million of quarterly expenses as noncash and cited an underlying EBITDA loss of just over C$1.1 million versus positive adjusted EBITDA of approximately C$1.3 million in 3Q FY25. Professional fees, management remuneration, and G&A increased approximately 70% y/y to C$2.58 million, while Houdini generated C$768,000 of EBITDA in June alone, making 4Q an important test of whether a full-quarter contribution can absorb the larger cost base and move underlying profitability toward breakeven. The expanded equity base has funded platform growth, but the 72% increase in shares outstanding raises the hurdle for per-share value creation. Shares outstanding increased approximately 72% from 23.0 million at September 30, 2025 to 39.5 million by mid-August through the LIFE financing, ATM issuance, convertible conversions, acquisition consideration, and other equity issuance. Through 9M FY26, operating activities used C$7.8 million of cash versus C$8.1 million y/y, while financing activities supplied C$31.8 million and investing activities consumed C$24.0 million, including treasury deployment and acquisitions. The capital raised has expanded STKE’s capacity to build the platform, but incremental value creation now depends on converting that investment into stronger revenue, EBITDA and per-share economics across Houdini, validator monetization and Zyga commercialization. 4Q should provide the first clear read on STKE’s transition toward a broader, more diversified infrastructure earnings model. Houdini contributed C$1.17 million of swap revenue and C$768,000 of EBITDA in only one month versus C$622,000 of staking and validation income for the entire 3Q, while the platform has expanded beyond 40 integrations and $2.8 billion of cumulative transaction volume. The setup into FY27 is increasingly driven by the contribution from these newer operating engines, with Street revenue estimates sourced from TIKR pointing to C$24.5 million of FY27 revenue. We would consequently focus near-term on a full quarter of Houdini revenue and margin durability, AuD stabilization from 3.4 million SOL, STKESOL flows from 646,000 SOL, Zyga commercialization, and liquidity execution. Delivery across those metrics would provide the clearest evidence that STKE’s infrastructure, treasury, and privacy technology are beginning to compound into a broader and more durable revenue model. Disclaimer: Exec Edge does not publish proprietary estimates, ratings, price targets, or investment recommendations. The valuation discussion below is illustrative only and is based on company filings, management commentary, and third-party data and estimates. It does not constitute a recommendation, price target, rating, or prediction of future pricing. We believe STKE should increasingly be valued as a blockchain infrastructure company rather than primarily through a treasury-based valuation framework. The business now combines validator infrastructure, cross-chain transaction and privacy technology through Houdini and Zyga, liquid staking through STKESOL, and a productive SOL treasury, creating multiple operating and asset-backed sources of value. Importantly, these engines are increasingly complementary: validators generate recurring fees on third-party assets, Houdini adds high-margin transaction revenue largely independent of SOL prices, Zyga adds proprietary privacy technology, and the treasury generates staking yield while providing financing flexibility. As this revenue mix broadens, we believe operating metrics such as revenue growth and margins should carry increasing weight alongside NAV. STKE trades at a substantial discount to blockchain infrastructure peers, providing a clear framework for operating-led rerating. At $1.18 per share, STKE has a market capitalization of $46.6 million and trades at approximately 2.6x FY27E revenue estimate of C$24.5 million ($17.7 million). This compares with an average of 6.6x for selected infrastructure peers Coinbase, Circle Internet Group and Securitize, which trade between 5.4x and 8.2x FY27E revenue. STKE is substantially smaller and earlier in its operating transition, supporting some discount, but the current gap remains significant. Applying the 6.6x peer average to FY27E revenue implies an illustrative equity value of approximately $117 million, or roughly $2.96 per share, broadly consistent with the Street’s $2.80 target. We view this as an illustrative rerating framework rather than a price target, with convergence dependent on sustained Houdini growth, improving revenue visibility and demonstrated operating leverage. The SOL treasury provides substantial asset backing underneath the infrastructure valuation and creates a second source of rerating potential. STKE’s direct SOL holdings are currently worth $38.9 million, equal to roughly 84% of the company’s $46.6 million market capitalization, leaving only a modest portion of current equity value above the treasury despite the operating businesses now inside the platform. STKE trades at approximately 1.20x mNAV versus 0.81x for the broader crypto treasury peer group, indicating that investors already assign some premium for its operating capabilities. We nevertheless view mNAV as a secondary valuation lens going forward. STKE has traded at higher treasury premiums during stronger crypto markets, and a recovery in SOL and broader digital asset sentiment could lift both NAV and the multiple applied to that NAV while operating infrastructure provides an independent path to value creation. Houdini provides a second tangible valuation anchor, while its operating footprint has expanded since closing. STKE acquired Houdini for approximately $18 million after the business generated roughly $13 million of revenue in 2025, providing an observable transaction reference for an asset that now represents a meaningful portion of consolidated revenue. Houdini contributed C$1.17 million of revenue and C$768,000 of EBITDA in June, its first consolidated month, while cumulative transaction volume has increased from approximately $2.5 billion around the acquisition to $2.8 billion and wallet and exchange integrations have expanded from 32 to more than 40. The $18 million acquisition value and $38.9 million SOL treasury together represent roughly $56.9 million of gross reference value, already above STKE’s current $46.6 million market capitalization before assigning standalone value to the validator platform, STKESOL or Zyga. This is not a direct equity-value calculation given STKE’s financing obligations, but it reinforces how little value the current capitalization appears to assign to the broader operating platform. Validator infrastructure, STKESOL and Zyga provide additional optionality beyond the two most visible valuation anchors. STKE supports 3.4 million SOL of AuD, maintains 100% validator uptime and has embedded institutional distribution through relationships including the VanEck Solana ETF, while STKESOL holds approximately 646,000 SOL across 1,300+ wallets and provides an additional fee-bearing layer. Zyga adds proprietary privacy and execution technology that can be commercialized through Houdini’s expanding distribution. We would not assign precise standalone values to these businesses at their current stage, but each creates additional opportunities for recurring fee, transaction and software revenue that are not fully captured by treasury NAV or Houdini’s acquisition value alone. The rerating opportunity is therefore supported by both operating growth and underlying asset value, creating an attractive asymmetry if execution improves. The clearest catalysts are sustained Houdini revenue and margins through its first full quarter, continued B2B and integration growth, stabilization of AuD from 3.4 million SOL, renewed STKESOL growth, commercialization of Zyga, and progress toward the C$24.5 million FY27 Street revenue expectation. A stronger SOL and crypto market could provide an additional catalyst through higher treasury NAV and renewed mNAV expansion. The principal offsets remain leverage, pledged SOL, dilution and the $5.75 million Houdini seller-note payment due December 1, making cash generation and per-share value creation important to realizing the rerating. Overall, we believe STKE’s current revenue multiple understates the combined value of a growing blockchain infrastructure platform supported by a substantial productive SOL treasury. Read Exec Edge’s Initiation on STKE Here Subscribe to our Weekly Newsletter to Receive All Research Contact: Executives-Edge.com [email protected] The post SOL Strategies Evolving Into Broader Blockchain Platform – Quarterly Update Report appeared first on ExecEdge.

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 8:00 a.m. ET Head of Strategic Finance - Scott Blair Co-Founder, Chief Executive Officer, and Chairman - Jeremy Allaire Chief Financial Officer - Jeremy Fox-Geen Scott Blair: Good morning, and welcome to Circle's Second Quarter 2026 Earnings Conference Call. I'm Scott Blair, Circle's Head of Strategic Finance. Earlier this morning, we posted our earnings press release and earnings presentation on the Circle Investor Relations website, investor.circle.com. A transcript of this call will be posted on that website once available. I need to remind everyone that our earnings press release, presentation in this call contain statements that are forward-looking. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. Information containing risks, uncertainties and other factors that could cause these results to differ is included in our SEC filings. Additionally, nothing in this presentation constitutes an offer to sell or a solicitation of an offer to buy securities or an invitation or inducement to engage in investment activity. We will also disclose non-GAAP financial measures on this call today. Definitions of those non-GAAP financial measures and reconciliations can be found in the earnings release and earnings presentation, which are posted on investor.circle.com. Non-GAAP financial measures should be considered in addition to, not as a substitute for GAAP measures. Today, I'm joined by Jeremy Allaire, our Co-Founder, Chief Executive Officer and Chairman; and Jeremy Fox-Geen, our Chief Financial Officer, who will walk us through Q2 results. With that, I'd like to turn the call over to Jeremy Allaire. Jeremy Allaire: Thank you, Scott. I'm excited to be here with all of you today to discuss Circle's second quarter results. As I've done in the past, I want to begin at a higher level and put in context where we are and what is driving Circle's strategy. We are living through a global moment. Around the world, governments, financial institutions and businesses are embracing digital dollars. Stablecoins are becoming federally regulated digital dollar money in the United States and similar frameworks are taking hold in major markets all around the world. This is the moment Circle has been building toward for more than a decade. That moment has drawn enormous attention and with it, competition. I want to address that directly. Circle is in a position of significant leadership. We have built deep and durable competitive moats around trust, liquidity, regulatory standing, technology and network scale. Our position has never been stronger. At the center of that position is USDC and the extraordinary network we have built around it. That network was built with partners, including a strategic partnership with Coinbase that we have grown over many years, and I'm pleased to share today that our agreement with Coinbase has renewed on its existing terms, ensuring that USDC remains central across all of Coinbase's products. At the same time, we look forward to continuing to grow our USDC network through distribution arrangements with strategically aligned partners. Let me start with the foundations of that network. USDC is the leading stablecoin network in the world, and it rests on significant technology and operational infrastructure. Circle and our stablecoin infrastructure are the most widely regulated in the industry. We hold over 55 licenses and registrations across major jurisdictions. That position took years to establish and is what ensures the legal availability of our infrastructure around the world, something that will take others many years to replicate. The software infrastructure that powers this open network runs on every major blockchain technology, spanning 35 blockchain networks and reaching users in 185 countries. We provide the critical protocols and on-chain smart contracts that make digital dollars work seamlessly wherever users are in whatever application they are using in a safe way. This is unparalleled in the industry. Alongside all of this, the financial infrastructure underneath USDC includes more than 15 partner banks around the world from some of the largest global systemically important banks to critical fintech-focused banks, ensuring the liquidity that underpins our network. We have also built a network of more than 150 distribution partners that have an economic interest in embedding USDC, growing USDC and supporting it across their commercial platforms. This is expanding and accelerating. And critically, thousands of other companies are also part of our network with products and services that have integrated USDC and use our infrastructure. They span every sector, wallets, DeFi protocols, payment apps, banks, neobanks, asset managers, exchanges, custodians, trading firms, brokerages and large enterprises. These companies have built and continue to build fundamental utility around USDC. That strength is evident even in recently announced purported consortium projects. Approximately 70% of the companies that have expressed interest are already participants on our network. Whatever role they may ultimately play in those projects, the more important fact is that they are already building on, distributing and supporting USDC today. Our network is not theoretical or aspirational. It is the largest, deepest and most widely integrated in the industry, and its scale creates powerful self-reinforcing network effects that will be extraordinarily difficult to replicate. Liquidity is essential to those network effects and to Circle's competitive position. On a primary basis, we have scaled USDC minting and redemption all around the world. In the second quarter, we saw an average of $1.9 billion of daily minting and redemption, up 105% year-over-year. This is infrastructure that works at scale. On a secondary basis, several billion dollars of USDC trades every day, making USDC one of the most liquid digital currencies in the world. And transaction volume on the network continues to grow robustly with daily on-chain transaction volume averaging $163 billion per day in Q2, up 151% year-over-year. This liquidity is what makes digital dollars work in markets, in payments and across business applications. Turning to the quarter. I want to focus on a few key highlights. We ended the quarter with $73.3 billion of USDC in circulation, representing approximately 20% year-over-year growth. Total revenue and reserve income was $701 million. Adjusted EBITDA margin demonstrated continued healthy profitability and transactional volume with USDC grew 151% year-over-year to nearly $15 trillion. We also saw expansion of our platform. In a huge milestone, we received our OCC National Trust Bank charter and shortly thereafter, an additional limited purpose trust charter from the State of New York. And as announced today, we have major strategic partners coming alongside us for the Arc Mainnet launch, which is happening this quarter on September 16. In another milestone, global systemically important banks began offering USDC minting and redemption directly to their institutional clients. Our payments network, CPN, continued to see very robust growth, reaching nearly $15 billion in annualized total payment volume on a trailing 30-day basis at the end of Q2. And we continue to build out and strengthen flagship partnerships from global banks to major regional financial technology players, payments companies and global financial firms. I want to spend a moment on the National Trust Bank because it represents something foundational. With final OCC approval, we have established Circle National Trust, an infrastructure bank for the Internet financial system. This is about confidence. Circle National Trust gives leading companies and financial institutions a federally supervised foundation on which to build digital asset services. It allows us to bring core elements of USDC into this new federally supervised framework. And it becomes a way to project Circle's infrastructure into global markets for payments, for capital markets and for use of digital dollars in corporations all around the world. Now moving on to details of our stablecoin network and digital asset growth and adoption. Digital asset markets themselves have continued to see significant weakness. Even so, we saw overall growth on a year-over-year basis and continue to maintain our market share position. More importantly, real-world payment volumes building on digital dollars have continued to scale, growing 84% year-over-year. USDC continues to be the leader in stablecoin transaction volumes. In fact, according to Visa, USDC share of stablecoin transaction volume reached nearly 70% in the month of June, a new record. Key measures of usage and liquidity have continued to grow. USDC on-chain transaction volume grew 151% year-over-year. While volume was down from the first quarter, which included significant activity from market makers, we continue to see steady growth in transactional utility. At the same time, we are seeing record amounts of minting and redemption of USDC with mint and redeem volume reaching $170 billion in Q2. This underscores USDC's critical and valuable role supporting payments and settlement moving between fiat infrastructure around the world. We are truly building fundamental new pipes for digital dollar movement globally. And while much of the focus is on USDC, we continue to hold market-leading positions across our other digital assets. EURC grew 2.2x year-over-year and remains the largest digital euro in the world. USYC grew 10x year-over-year to become over $3 billion in assets and remains the largest tokenized money market fund in the world. I also want to talk about the significant evolution happening in digital trading markets and Circle's role in it. Perpetual futures have become one of the most important tradable instruments in the world. The market has evolved from people buying and selling Bitcoin into people trading these perpetual futures at global scale. On the largest centralized and decentralized platforms in the world, Binance and Hyperliquid, USDC's position has continued to strengthen, reaching 40% of open interest collateral in these markets. And there is a real shift happening in what people are trading. The market is moving away from speculating on cryptocurrencies and into open global digital asset markets that support trading tokenized stocks, tokenized commodities and other tokenized assets. In fact, for the first time, the majority of traded volume on Hyperliquid, one of the most important venues in the world, is now in real-world assets rather than digital commodities and cryptocurrencies, reaching nearly 75% of Perp's volume as of last week. This is a major change in the structure of the market, and Circle is very well positioned as the leading provider of stablecoin infrastructure to these markets. We are also seeing dramatic growth in prediction markets as a major source of digital asset trading activity. Spot volume on Polymarket grew more than 8x year-over-year, and open interest posted in these markets grew more than 4x year-over-year. Polymarket is a strategic distribution partner for USDC, which underpins this activity. Now let me turn to Arc. Arc is coming, and we are excited to announce today that Arc Mainnet will launch this quarter on September 16. We have seen tremendous traction as the infrastructure gets ready for this moment. Our Testnet has processed more than 0.5 billion transactions across nearly 3 million wallets with nearly perfect uptime. And more than 100 partners are already active on our private Mainnet, preparing for the public launch. Crucially, Arc has been built as financial infrastructure to be run by the leading financial firms in the world. Today, we are announcing the initial cohort of firms that will operate the Arc blockchain network alongside Circle as network validators. This includes the world's leading asset manager, the world's leading equities and securities clearing firm, leading digital asset firms, the largest exchange group in the world, the 2 largest retail payments networks in the world, leading banks from around the world and leading payment processors and remittance companies. This is an incredible group, running infrastructure that others can build on. No other blockchain has been built with this kind of strength. It is an amazing milestone, and we are thrilled for the launch in the coming weeks. Alongside the Mainnet launch, we are announcing 2 major partnerships today. The first is with DTCC. DTCC underpins so much of our equities and securities markets today, and DTCC is collaborating with Circle to bring tokenized securities to Arc, focusing first on enabling the tokenization of DTC-custodied assets on Arc. Over time, this extends to broader capabilities, tokenized repo, collateral mobility, corporate actions, securities lending, dividend distribution and participant reporting. This reflects Arc's infrastructure model, purpose-built for financial institutions with deterministic settlement finality, configurable privacy and a network operated by financial infrastructure companies. DTCC will participate in running the Arc Layer-1 network and DTC tokenized assets will carry the same protections, rights and safeguards that investors receive with traditionally held assets. The second partnership is with BlackRock, who plans to deploy BUIDL on Arc to leverage our infrastructure with native USDC integration. This enables institutional investors to subscribe, redeem and deploy fund assets within a single on-chain environment, removing friction that has historically limited tokenized fund adoption at scale. Institutional fund management meets a network built for financial markets and stablecoin native settlement. We could not be more excited about these 2 partnerships. Turning to payments. We continue to see tremendous progress with CPN. At the end of Q2, annualized total payment volume reached nearly $15 billion on a trailing 30-day basis. That is tremendous growth on a year-over-year basis and on a quarter-over-quarter basis. We continue to enroll new financial institutions into the network with nearly 30% quarter-over-quarter growth, reaching 175 financial institutions and the momentum has continued. Sitting here today, as of July 31, annualized total payment volume on a trailing 30-day basis has already reached $23 billion, representing 130% growth since our last earnings report. Alongside this growth, we are making major progress in product and market expansion. CPN and our related payments products are rolling out across international markets and now reach more than 58 countries. Our core operations infrastructure is enabling much more seamless onboarding for financial institutions with stronger operational tooling. And all of this is being integrated across our full stack, including Arc, Circle Mint and our new stable FX venue. We're incredibly excited about this progress, and we are excited about beginning to monetize CPN. I want to close the product discussion with agentic finance, where we are seeing emerging traction with Circle's agent stack. In the coming days, we will be publishing a white paper and our near-term road map for the agentic economy. We are moving from a world where blockchains, stablecoins and digital wallets are the rails that agents can pay with to a world where agents can earn and monetize. Already today, the USDC network alongside payment protocols like x402 handles 99.3% of agentic payments. More than 900 paid services are already available in our agent marketplace. As we go forward, we see a world where more and more agents conduct work and a labor market emerges for those agents. A developer can build and deploy an agent in minutes. That agent has its own identity. It can be discovered easily by other agents, and agents can monetize their services directly on chain. Reputation, trust and discovery are all critical to how the agent economy will evolve, and we are excited to lay out our road map for building and delivering this in the second half of this year. Our work on agentic infrastructure is also unfolding inside of Circle. We are building toward operating an agentic corporation. In the first half of this year, we proved adoption at scale. 86% of our employees are weekly active users of AI tools. Our employees have shipped more than 1,100 AI apps this year, most of them over the course of Q2 and most by nontechnical builders. Hundreds of agent skills have been published into an integrated circle AI toolkit available across the company. And we now have continuous agent run software development with product development velocity up several hundred percent over the first half of the year. In the second half, we are moving from adoption at scale to orchestration at scale. We are standing up infrastructure where hybrid teams of agents and humans operate, working together as one. Underneath that, we'll sit a company brain with memory and orchestration between humans and AIs and between AIs and other AIs connected by a messaging layer. On top of that, we are rolling out agent authoring tools to every employee in every team on a self-service basis so they can build individual and cross-functional agents with highly skilled capabilities across nearly every domain in the company. And underneath it all, we're building model infrastructure that lets us optimize across any model for performance, cost and capability. All of this is bound by a robust policy, security, governance and risk layer appropriate to a global financial infrastructure company like Circle. This is a transformation in how we operate, how we build and how we deliver. We talk about the agentic economy and the emergence of on-chain agentic corporations. That is exactly what we are building here at Circle, and we're incredibly excited about what this will enable over time. I want to conclude with where I started. This is a global moment for digital dollars. Stablecoins are becoming federally regulated digital dollar money and the world's leading financial institutions, technology companies and enterprises are moving on to this infrastructure. Circle enters this moment from a position of extraordinary strength. We operate the largest, most liquid, most widely regulated stablecoin network in the world. We have renewed and deepened our most important partnerships and the greatest firms in the world are joining us as network participants, as validators on Arc and as builders on our platform. We are launching Arc Mainnet in a matter of weeks with a cohort of network validators no other network can match, and we're building the infrastructure for the Agentic economy while becoming an Agentic corporation ourselves. It's an incredibly exciting time to be building here at Circle, and we are thrilled with the progress we made this past quarter. With that, let me turn it over to Jeremy Fox-Geen, our CFO, to take you through the financial results. Jeremy Fox-Geen: Thank you, Jeremy, and good morning, everyone. I'll start with a few observations that provide context for the quarter before turning to the financial results. First, as Jeremy mentioned earlier, USDC reached nearly 70% of stablecoin transaction volume in June, up from 36% in Q2 last year, reflecting the strength of our network and the trust that we've built across the ecosystem. Second, USDC circulation has remained resilient. While the broader digital asset market capitalization declined approximately 40% year-over-year, leading to reductions in trading activity, DeFi, collateral demand and associated market maker balances, USDC circulation grew 19% over the same period, underscoring the decoupling of USDC usage from the vagaries of the digital asset markets, the resilience of USDC through that market cycle and signposting the underlying growth in non-crypto market adoption and usage. Those are the massive markets we're building for. And third, we continue to expand our infrastructure and application layers with strong growth in CPN, the upcoming launch of Arc and the approval of our National Trust Bank. These are important proof points that our strategy is taking shape. So with that context, I'll walk you through the financial results. USDC circulation ended the quarter at $73.3 billion, up 19% year-over-year. While ending circulation moderated at quarter end, average USDC circulation reached an all-time high of $76.5 billion in the quarter. USDC held within Circle's platform infrastructure increased 106% year-over-year to $12.4 billion, representing 17% of circulation. USDC on Coinbase's platform reached 30% at quarter end, with Hyperliquid accounting for approximately 6% of that total. The reserve return rate was 3.48% for the quarter, down 66 basis points year-on-year, reflecting the decline in SOFR during the period. Total revenue and reserve income was $701 million in the quarter, up 7% year-over-year as growth from circulation and other revenue was partially offset by lower reserve return rate during the period. Sequentially, total revenue and reserve income increased as average circulation hit an all-time high, but was partially offset by lower rates and other revenue. Other revenue was $34 million, up 1.4x year-over-year, driven by growth in blockchain partnerships. Quarter-over-quarter, other revenue declined by $8 million, reflecting both moderating blockchain revenue amid weak digital asset market conditions and our deliberate decision to prioritize Arc over other blockchain partnerships. Subscription and services revenue declined $7 million, driven by fewer blockchain integrations. Transaction revenue declined by $1 million due to declining validator awards. Revenue less distribution cost margin was 41.2%, up 3 percentage points year-over-year, driven by our strategy to increase USDC held on our platform and grow high-margin other revenue streams. Quarter-over-quarter margin decreased 21 basis points with strong platform execution and mix optimization, partially offsetting the impact of lower other revenue. The new Hyperliquid arrangement for USDC had minimal impact on Q2 results as the migration to Coins platform ramped late in the quarter. We expect that impact to be reflected beginning in Q3. Total revenue and reserve income less distribution transaction and other costs grew 15% year-over-year to $289 million. Adjusted operating expenses were $146 million, up 23% year-over-year, driven by continued investment in product development, go-to-market infrastructure and our AI capabilities. Sequentially, adjusted operating expenses increased $11 million in the quarter or 8% as we continue to execute against our strategy. The expenses were driven by Arc marketing spend, continued infrastructure expansion and investments in G&A. Adjusted EBITDA grew 8% year-over-year to $143 million, and adjusted EBITDA margin was 50% in the quarter. Now before turning to guidance, I want to start by addressing a question we've received around our multiyear through-cycle USDC growth framework. As we've said before, we are building infrastructure for the next generation of the financial system, and we continue to see structural shifts taking place across regulation, international adoption, enterprise use cases, agentic finance and the broader acceptance of digital assets and blockchain technology. We believe those trends remain intact and that Circle is uniquely positioned at the center of that evolution. And we are excited about the partners actively committing to the USDC ecosystem and to the quality of institutions interested in even greater strategic partnership. Given the magnitude of these structural shifts, our own historic growth patterns and the potential for rapid scaling characteristic of Internet platform companies, we believe that a 40% growth CAGR over several years through cycle is achievable. And when we look across third-party research, they project the stablecoin market for 2030 to be between approximately $1 trillion to $4 trillion, implying compound annual growth rates of 27% to 77%. We expect that this growth will come from the massive regulated markets that make up the global economy and that the vast majority of institutions, enterprises and platforms will choose to build on compliant regulated digital dollar infrastructure. We note that our own 40% target is well within this range. Now with that context, let me turn to the remaining components of our guidance, beginning with other revenue. We are raising our other revenue guidance range to $310 million to $330 million, up from $150 million to $170 million. The increase is driven by Arc. When we set the original range, we took a conservative view on contribution from new products. We are pleased that Arc, in particular, has been so successful and that we have been able to create a $3 billion asset even before Mainnet launch and execute a successful $242 million presale of the Arc token in Q2. We expect to recognize this token presale revenue as certain product milestones are achieved. Based on our product road map, we expect to achieve approximately 75% of the milestones in revenue in 2026 and have included $180 million in the revised guide. As this revenue is recognized, it will flow directly to the bottom line. The remainder of our products are expected to deliver between $130 million and $150 million. This reflects our strategic decision to focus resources on the development of Arc instead of additional blockchain partnerships as well as moderation in commercial opportunities with new blockchain partners, reflecting softer digital asset markets. Turning to RLDC margin. We are increasing our full year outlook range to 41.7% to 43.7% from 38% to 40%, reflecting our prior guidance range augmented by the addition of anticipated revenue from Arc. Excluding that Arc revenue, we expect full year RLDC margin to come in near the midpoint of the prior range. Finally, turning to adjusted operating expenses. Our guidance range of $570 million to $585 million remains unchanged, although we expect to land at the higher end of that range. Given the strength of our balance sheet and the very attractive long-term returns we expect from investing behind our platform, we believe that now is the right time to sustain this investment. As Jeremy mentioned, this is the moment Circle has been building toward. Our financial foundation is strong, our network is growing. And in just a few weeks on September 16, we will launch Arc Mainnet with a cohort of network validators no other blockchain network can match. At the same time, we're building out the infrastructure for the agentic economy, positioning Circle at the center of how value will move in an AI-driven world. The opportunity ahead remains large, and we could not be more excited about the rest of this year and beyond. Now with that, I'll turn it back over to Scott to start the Q&A. Scott Blair: Thanks, Jeremy. We're starting Q&A again with a few questions we collected from analysts on the Say platform. Our first question is from Norman, who asks, if we can talk to the delay of CLARITY passing. Jeremy Allaire: Sure. I'm happy to take that, Norman. Thanks for the question. As I think a lot of people know, the CLARITY Act is very actively being discussed and kind of final issues are being worked on, I think, literally as we speak in the Senate. I think there are a few key issues that are being negotiated between the Democrats and the Republicans. I think the goal is to try and get to at least the leader of the Senate, the goal is to try and get to a motion to proceed in working on the bill on the Senate floor this week. We'll see if that happens. I think our view is a few things. I think the first is we are seeing bipartisan work here to try and get this legislation done. And there are kind of, again, a few critical issues, but I think that they're very much resolvable. Whether they get done this week or in a subsequent convening of Congress, we'll see. But there is a genuine bipartisan effort to get this done, and I think very broad industry support and non-industry support as well. I think the second thing I'd say around this that's really important is that for Circle, the GENIUS Act, which passed a year ago, is the most critical piece of legislation. And the GENIUS Act has just gone through its proposed rulemaking, and we know will become effective in January of 2027. I referenced that a little bit in my earlier comments. Legal digital dollars in the U.S. financial system and therefore, in the global financial system is a kind of bedrock foundation for what we're building. And so that is critical and I think allows the entire financial industry to move forward with this. Then the third thing I'd say as well is I think there's been, I think, pretty good coverage of this, but the key regulatory agencies from the banking regulators to securities and capital markets regulators are also very proactively working on their own rule-making in this space to support kind of continued maturation and clarity of rules around how capital markets will function in this area. So obviously, we're all watching that closely. Scott Blair: Great. Thanks, Jeremy. The second question comes from Sean, and he wants to know if we plan to roll out quarterly dividends in the near future. Jeremy Fox-Geen: I'll take that one. The short answer is no, we don't. But let me put that in context. We have a massive opportunity ahead of us to be the leading Internet platform company as the whole world evolves from traditional technologies and rails into new Internet-based financial services built on blockchain technology. And as we've always said, we want to have a strong balance sheet to ensure that we can continue to invest against that opportunity through market cycles, no matter what comes and also so that we can be opportunistic to take advantage of great opportunities when they come up. So with that, we believe in retaining a strong balance sheet, and we believe that the returns available to our shareholders on investing in the platform are far greater than those from sort of paying out quarterly dividends. Fundamentally, we are a massive future market growth stock versus a stock that returns capital to shareholders today. Scott Blair: Thanks, Jeremy. Okay. Our last question from Say this quarter comes from Sreedhar, and he has a product road map question. He wants to know what's the road map for platform revenue besides passive reserve income? And what should we expect in 2026 and beyond? Jeremy Allaire: Sure. I'm happy to take that. We've been talking now, I think, over the last year about building out these kind of 3 pillars of our platform, our digital assets pillar where USDC is central, but where we're expanding that into other digital assets, our payments pillar with CPN, which, as I've just shared, continues to grow very robustly. And then our developer infrastructure and operating system pillar with Arc. We obviously, just as discussed, we are already seeing, I think, significant other revenue growth. And in fact, from the beginning of 2025 through today, we've seen that grow from essentially 0 to now a guided range of around $300 million in 2026. And so that is obviously growing. There are multiple pieces to this. So there's the partnerships that we build around infrastructure that supports our stablecoin network expansion. There are transaction fees that are associated with use of our platform. Arc itself is multiple new sources of revenue. Obviously, we're discussing today the ARC Token and the ARC Token presale, but Arc itself includes revenue from staking, revenue from transactions that run on the network, which is revenue that Circle will be able to collect, but also that other stakeholders and validators on the network will be able to collect. And then there's also revenue associated with partnerships and incentive partnerships that we build with partners building on Arc. So Arc is going to become a diverse set of revenue and already is in 2026, and we expect that to continue in 2027. CPN, as we've talked about, we're very excited about. We're excited about the traction and growth. We made it very clear when we launched that product that our primary focus was how do we get this platform to scale. And we're starting to see that going from essentially a brand-new product that was cleanly built internally at the company to now as of July 31, $23 billion of annualized TPV run rate payment volume. Now it is becoming the time for us to start to monetize that. So that will start really in the second half of this year. But we have very ambitious growth goals for that network, very ambitious growth goals ultimately over the long run in terms of what revenue can be derived there. And then I think the last thing I'd say is the velocity of product development that's happening at Circle right now is incredible. I talked about the productivity that we're seeing from agentic infrastructure in our software development. That velocity is allowing us to cover more surface area. And so you will continue to see Circle expanding its product surface area. And alongside that product surface area expansion, you'll see new monetization opportunities that emerge from that as well. So more to come as we continue to build and innovate in our platform. Jeremy Fox-Geen: And Jeremy, if I can just add to that, I want to take a point on part of the premise of the question, which is this idea of passive reserve income. I also want to remind everybody that at $70-odd billion, we view the USDC product and the reserve income stream still is very early stage. The market -- the addressable market for money is about $120 trillion, of which about half, $60 trillion is noninterest-earning money. And so we're building an Internet platform company, as we both said in our remarks earlier. And Internet platform companies can scale incredibly rapidly into massive markets as they disrupt. And that scaling is predicated not only on everything that we're building, but also on all of the work by all of the builders and the developers and the companies that are building products and services based on USDC to offer better products and services to their customers. So there is an awful lot of activity, not just from us, but from the entire ecosystem that's building our USDC business and the reserve income line. And that's a massive market. So we just think we're just getting going. Scott Blair: That was great. Thanks, guys. Now before I turn it over to the moderator, I want to thank Norman, Sean, Sreedhar and everyone else who participated in our Say questionnaire this quarter. Thanks all. With that, I'm going to pass it over to Denise to begin live Q&A. Operator: Scott. Our first question today comes from Pete Christiansen at Citi. Peter Christiansen: Jeremy Allaire, I wanted to dig a little bit more into competitive positioning, specifically around USDC's distribution mode in light of the OUSD announcement earlier last month. The market seems to be framing this potentially as a binary issue, Open Standards model of equally sharing reserve income with all distribution partners, including Visa, potentially as a structural advantage that Circle can't replicate given its existing economics with Coinbase. But what caught our attention, I think, this quarter was the joint Hyperliquid announcement, which you spoke about earlier, where Circle and Coinbase collaborated on a share revenue agreement together. To us, this suggests that Circle has a mechanism to deploy distribution capacity in a complementary way alongside Coinbase rather than being constrained by that relationship. I guess, can you help us understand your thinking about that framework going forward more broadly and how Circle plans to compete for distribution in a world where reserve income sharing is becoming table stakes. Jeremy Allaire: Thanks, Pete. It's a great question. A few comments that I want to make here as well, and I touched on this a little bit in my comments. I think critically, we already have an incredible amount of distribution, distribution incentives and partners building on our network, thousands of companies, in fact, part of our network over 150 companies, we have distribution partnership agreements with that provide economic incentives to grow USDC, to build on USDC, to distribute USDC. So this is something that we've been doing for a very long time. And in fact, we do it together with Coinbase often. And so I think getting to the other part of your question, our ability to build really great distribution, win-win distribution arrangements with major companies is absolutely there. I think you gave one example. There are certainly others. What I would say is a couple of things. The first is, and I think we heard this from Brian on his earnings call last week, Brian made it very clear. His focus is on ensuring that USDC is the #1 stablecoin in the world. It's #1 in multiple areas, and we want to make it #1 overall. I think we share that. And so it's very, very clear. The second thing I'd say is some of the other partners who announced prospective involvement with a consortium coin also made it very clear in their own earnings calls that they're taking an agnostic approach, multi-coin, multi-chain, et cetera. And in fact, we continue to expand our relationships with these leading firms. Just today, we announced expanded collaboration with Visa and with Mastercard, who are becoming key infrastructure partners in Arc, which is USDC native in terms of its transaction infrastructure and settlement infrastructure. And so we see around 70%, in fact, of companies involved in these kind of consortium efforts already building with us. Final comment I'd make, which I think gets to the heart of your question, which is we are seeing incredible interest from major companies in wanting to be part of the USDC network. And we see this all around the world, everywhere that we go. And we absolutely have the opportunity together with Coinbase to form partnerships where it makes sense, where we believe that a company can really materially help drive the growth and adoption of USDC. And so I think we're quite confident in the position that we have, the leadership position that we have. And likewise, I think we have the tools that we need to continue to partner with the best companies in the world to grow together. Peter Christiansen: Great. Our next question comes from Ken Suchoski from Autonomous. Jeremy Allaire: Not hearing question. Kenneth Suchoski: Guys, can you hear me? Jeremy Allaire: Yes, now we can hear you. Kenneth Suchoski: [indiscernible] detail on the Arc, presale and what's included in the guidance. Great to get some more detail in commentary, some type of [indiscernible] it seems like Circle [indiscernible] opportunity in that market? And then maybe just a couple of specifics around the deal. Are Circle and Coinbase [indiscernible]? Jeremy Allaire: Sure. No problem. I can take the first part of that, and then maybe I'll have Jeremy Fox-Geen take the second part of that. I think on the first part is I think what's incredible is that a high-growth platform like Hyperliquid, which also, by the way, looked at getting behind another stablecoin project, ultimately, I think, realized that the liquidity, the network effects, the institutional preference, the global regulatory availability of USDC made it the stablecoin that they needed to get behind. And so I think the first is that it just underscores that we are winning in the market on the basis of the incredible network effects that we've already created. And so there's -- that is key. The second, and this is very important, is when you look at certain types of distribution platforms, whether they're the biggest global exchanges or you look at which Hyperliquid effectively is, they play a really key role as what I like to call liquidity Supernovas, which is to say the liquidity that concentrates on these platforms spins out and affects distribution and availability in so many other places. And so when we think about major tenfold distribution partnerships, we think about that. What are the network effects? What is this going to do to drive preference and adoption in lots of other applications. So as a critical kind of on-chain market primitive, it's very important that, that's the case. And so I think it's with that spirit that Circle and Coinbase together looked at, let's build this arrangement so that this important and high-growth platform, which, as I noted in the earnings call, close to 75% of the traded volume is now actually tokenized real-world assets. So this is becoming a convergence of traditional financial markets and these on-chain markets as well. It's a really critical piece for us. And so I think that's the strategic rationale behind the work there. And I'll let Jeremy address the specific financial questions as well. Jeremy Fox-Geen: Yes. thank you, Jeremy. As it comes to the Hyperliquid arrangement itself in which both Coinbase and Circle and Hyperliquid are all participating. You can see on chain the exact location of the funds within Hyperliquid's platform in relation to where they're held within either Circle or Coinbase's platform. At quarter end, approximately 90% of Hyperliquid's total USDC was held within Coinbase's platform and about 10% of Hyperliquid's total USDC was within Circle's platform. As for the specifics of how that revenue share is detailed, we're not commenting in more detail on the precise nature of that between Circle and Coinbase. Operator: Our next question comes from James Yaro at Goldman Sachs. James Yaro: Jeremy, you spoke to a deliberate decision to prioritize Arc over other blockchains and that could have an impact on other revenue. I was hoping you might just expand a little bit on this decision, what this means going forward and how this changes the subscription services component of other revenue going forward. Jeremy Allaire: Maybe I can take part of that and Jeremy Fox-Geen can take another part of that, which is I think the first is really the strategic decision, which is Arc represents one of the most massive opportunities that we've ever seen as a company. I think I maybe said on the last earnings call, we look at Arc as potentially as bigger than an opportunity than USDC itself. And so this is the birth of a new operating system layer for economic activity in the world. We believe that an incredible amount of financial activity, economic activity, agentic activity are going to move on to these operating systems. And we believe over the next 3 to 5 years, the opportunity set exists for these to become very large-scale infrastructures on the Internet. And so I think for us, both as a 25% stakeholder in that network as well as a key operator of infrastructure in that network as well as the kind of compounding effects of that network's adoption in terms of real-world asset adoption, stablecoin adoption, transaction fees in stable coins, settlements in our stable coins, all of these pieces make it an incredibly attractive thing to invest in. And so from our perspective, that as a source of major other revenue going forward is very attractive. The margin characteristics are very attractive. The diversification of different types of product and product SKUs that can be attached to that are very attractive as well. And so I think from our perspective, that's exactly the kind of other revenue that we want to be building, and it's a strategic infrastructure that compounds value to Circle in many, many other ways. In terms of specific commentary on what that does to other revenue over beyond 2026, I'll let Jeremy speak at a high level about that, although I'm not sure we have that much to say. Jeremy Fox-Geen: Yes. Thank you, Jeremy. Look, the subscription and services revenue line that you asked for, as we've said, is based on the partnerships that we build with other blockchains to bring USDC and the rest of Circle's infrastructure stack to those blockchains. Those contracts have both an upfront component and a recurring component. And as we said, we've been aggressively working through a pipeline of those over the first few quarters of this year and at the back end of last year. I think we've said that consistently, and we're sort of working through those, and there's a lumpiness inherent to that because of the upfront fees. We're still prioritizing this as a service. It's very important to us that USDC is available on the blockchains where people are building activity, and we very much value those partnerships. As what it means for the rest of the year, you can look at our other revenue guide, and you'll see the implication of that on the second half of the year. Operator: Our next question comes from Owen Lau at Clear Street. Owen Lau: Could you please add more color on the road map of agent -- you can hear me? Can you hear me now? Sorry. Jeremy Allaire: There we go. Owen Lau: Okay. Could you please add more color on the road map of agentic product in the second half of this year? When should we expect to see more revenue contribution from agentic commerce? I know it's still small. It's still growing, but we just want to understand when it can become more material to Circle longer term. Jeremy Allaire: Thanks, Owen. It's a great question. So I talked a little bit about our second half road map in the call. And as I noted, we're actually going to be publishing a lot more detail on that in the coming days. So stay tuned for that and watch that. What I'll say specifically is -- the first set of product introductions that we've made are really around enabling agents to have wallets, enabling agents to have policies and guardrails around those wallets, enabling them to make and receive payments using open standard agentic protocols. And we've, alongside that, launched a curated agent marketplace that has -- now has 900 services in it. What's exciting is that we continue to see organic adoption of the agentic payment stack and organic adoption of services, data providers and other agent marketplaces offering more and more services. So literally, every day, every week, we're seeing more and more of these. In fact, just yesterday, Cloudflare had a big announcement, they're making agentic wallets with x402 and USDC support available as a core part of their offering. They touch a huge percentage of the Internet. So that's very exciting. We're seeing this organically happen. In terms of the second half and sort of the materiality, there are a number of really key things. And our vision is that agents basically begin to take on more cognitive work and agents conduct and execute services and labor. And in order to do that, sort of these agents as services need to be able to have identity mechanisms. They need to be able to have automated discovery mechanisms, so agents can basically seamlessly discover other agents and their capabilities. And they need reputational systems like the reputation systems that we've seen in Internet marketplaces and platforms where you have reputation that is based on prior engagement like a page rank on Google as an example. And then finally, you need very simple ways for someone who builds an agent to enable their agent to just earn to earn and monetize their work. And so we're doing -- we're working on all of those things. And I think we'll outline in detail what that looks like. But we want this whole agentic economy to function. We want to enable agents to be providers of services to other agents and to companies around the world. And each one of those capabilities, our approach is to do it through open standards. And so this is not a proprietary circle thing. We want all of this to be based on open standards and obviously collaborating with the incredible ecosystem that we already have today. In terms of direct impact on revenue, I mean, very clearly, we believe over time, the amount of stablecoin money that is held and used in agentic applications will grow and the velocity of transactions will grow. And we are ensuring that Arc as an infrastructure is an ideal infrastructure. It is an economic operating system that is designed to work with these intelligence operating systems and agentic systems. And so driving utility, transaction volume and assets on Arc directly accrues to revenue to Circle as well. So we see the agentic stack as driving some revenue around the protocols themselves, but fundamentally driving stablecoin adoption, which drives revenue and driving Arc infrastructure adoption, which drives revenue as well. Operator: Our next question comes from Ken Worthington at JPMorgan. Kenneth Worthington: Can you talk about distribution and transaction costs associated with USDC on Circle platform? I can't tell for sure, but it looks like costs specific to Circle on Platform USDC came down a lot from 1Q to 2Q. Did I get that right? And if so, how did the mix of USDC on Circle Platform change? And how is mix change, including CPN, impacting what you're seeing in terms of distribution costs to win Circle on-platform USDC? Jeremy Fox-Geen: I'll take that one, and Ken, thank you for the question. You're asking a very detailed question, and we don't give disclosure at the level of margin and mix within our platform and within the totality of USDC. But in general, I think what you're seeing happening, and you can tell that from our guide is the overall margin, you can tell from the guide and what we printed in the first half of where we're seeing that coming out. And we've always said there's a lot of puts and takes inherent in that mix. When you think of how USDC is used across the entire digital asset ecosystem and increasingly outside of the digital asset ecosystem and both on and off platform, there are pockets of heavily incentivized USDC. There are large pockets and very large dispersed surface area of USDC that carries very little incentive at all. And so within any one quarter and over any period of time, there's movements in every single one of those pockets. Now I appreciate that makes it very, very hard to forecast margin quarter-on-quarter, and that's the world we're inhabiting in. Now we feel very comfortable with our year-end guide overall. We've had puts and takes through the first half. And as we said, the trajectory is still when you back out the $180 million of expected to be recognized revenue, the trajectory of that is pretty much towards the middle of our previously guided range. Operator: And our last question this morning comes from John Todaro at Needham. John Todaro: I was wondering if we could spend just a little bit more time on x402. I understand USDC pretty much dominates that right now at 99% plus. There are some other competitors who are looking to launch stablecoins and operate within that. Is there sort of almost an inherent right to win for you guys within that x402 stack or even a benefit you could get from just more adoption within those payment channels? Jeremy Allaire: Yes. I mean we think about this a lot, and thanks for the question, John. So we were an early design partner in x402. We're one of the kind of key founding members of the x402 Foundation. There's a lot of great companies that are now involved in that. And x402 effectively optimizes for on-chain payments and settlement. And I think in the agentic space, agents want actual money, so they want actual digital dollars. They want to know that the infrastructure is something that can process in fractions of a second for fractions of a cent. They want to be able to transact where some of the transactions are as low as just a few cents themselves, and we see that in our own agentic marketplace and what people are doing with x402. So all of those things lend themselves extremely well to USDC and to the blockchain infrastructure that we provide and many of our partner networks also provide. And so we absolutely have a right to win, and we are clearly winning. And I think like other aspects of the market, where you see, for example, at the end of June, 70% of real-world stablecoin payment volume being USDC is that there are powerful network effects that exists. And so even the LLMs as they work with the agents that are deployed on them and discover like what can I use and what's available and what are other agents using, that actually is a network effect. The intelligence layer itself is informed by the utility that exists and the scale of that, that exists. And so we feel very good about the strong position that we've already staked out there. And I think with the product stacks that are coming out of a lot of great companies, including obviously, Circle with a major push on our agent stack, we expect that to continue. And so I think we feel very good about the right to win, the network effects and the work that we're doing to promulgate this infrastructure into the intelligence layer itself so that USDC is the preferred form of money in the agentic economy. And I guess with that, I think that's our last question. And I want to thank everyone, for joining us today on the Q2 earnings call. We're very pleased to share the results, and thanks for the question. Have a great day. Before you buy stock in Circle Internet Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Circle Internet Group wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $403,337!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,334,946!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 12, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Circle (CRCL) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Circle Internet Group, Inc. CRCL used its second-quarter earnings call to put Arc at the center of its next growth phase, with management framing the blockchain network as a major platform opportunity ahead of its Sept. 16 mainnet launch. The company also raised its 2026 other-revenue outlook sharply. Earnings of $0.18 per share topped the Zacks Consensus Estimate of $0.16, while total revenues and reserve income of $701.3 million came in below the $741.8 million consensus estimate. Circle Internet Group, Inc. price-consensus-eps-surprise-chart | Circle Internet Group, Inc. Quote Co-founder, chairman and chief executive officer (CEO) Jeremy Allaire said Arc already has more than 100 ecosystem and institutional builders, with BlackRock and DTCC among the major partners preparing integrations around tokenized assets and settlement. A Goldman Sachs analyst asked why Circle was prioritizing Arc over additional blockchain partnerships. Allaire said Arc represents one of the company’s largest opportunities and could become a broad operating-system layer for financial and economic activity. Chief financial officer (CFO) Jeremy Fox-Geen said the shift carries near-term tradeoffs. Other revenues declined $8 million sequentially as blockchain revenue moderated and Circle deliberately directed resources toward Arc. Fox-Geen raised 2026 other-revenue guidance to $310 million-$330 million from $150 million-$170 million, with Arc driving the increase. The CFO said Circle completed a $242 million ARC Token presale in Q2 and expects to recognize $180 million in 2026 as product milestones are achieved. The remaining product portfolio is expected to contribute $130 million to $150 million. CRCL also lifted its 2026 revenue-less-distribution-cost margin outlook to 41.7-43.7% from 38-40%. Adjusted operating-expense guidance remained $570 -$585 million, with management expecting spending near the high end. USDC ended Q2 with $73.3 billion in circulation, up 19% year over year, while average circulation reached $76.5 billion. Onchain transaction volume rose 151% to $14.8 trillion. A Citi analyst pressed management on whether competing distribution models could pressure Circle’s economics. Allaire said Circle already has more than 150 distribution agreements and can structure additional arrangements alongside Coinbase where partners can materially expand USDC adoption. Fox-Geen said the Hyperliquid arrangement had minimal Q2 impact because migration ramped late in the quarter, with the financial effect expected to begin in Q3. At quarter end, about 90% of Hyperliquid’s USDC was on Coinbase’s platform and 10% on Circle’s. Allaire said Circle Payments Network reached $14.7 billion in annualized trailing-30-day payment volume at quarter end, up 76% sequentially, with 175 financial institutions enrolled. By July 31, annualized payment volume had climbed to $23 billion. Allaire said the priority has been scaling the network, but Circle plans to begin monetizing CPN in the second half of 2026. The CEO also said CPN and related payment products now reach more than 58 countries. Management positioned payments as one of three platform pillars alongside digital assets and Arc-based developer infrastructure. Allaire said 99.3% of x402 agent-payment volume settles in USDC, while Circle’s Agent Stack marketplace has more than 900 paid services. A Clear Street analyst asked when agentic commerce could become more meaningful financially. Allaire said the second-half roadmap centers on agent identity, automated discovery, reputation systems and tools that let agents earn from services. A Needham analyst asked about Circle’s competitive position in x402. Allaire, who noted Circle was an early design partner, said growing agentic usage should support USDC transaction activity while also driving adoption of Arc infrastructure. Management’s tone remained confident around Arc, USDC distribution and payments expansion, while acknowledging softer digital-asset markets and lower reserve yields as near-term constraints. Fox-Geen maintained Circle’s multi-year 40% USDC circulation growth CAGR framework and said the company intends to keep investing in the platform. He also ruled out near-term quarterly dividends, favoring balance-sheet capacity for growth investments. CRCL carries a Zacks Rank #3 (Hold). Its Growth Score of B is the strongest style reading, while the Value Score of D is weaker and the Momentum and VGM Score of C each sits in the middle of the grading scale. The combination does not carry the stronger signal associated with Zacks Rank #1 (Strong Buy) or #2 (Buy) stocks paired with an A or B Style Score. The Zacks Rank can change as earnings estimates are revised following the just-reported results. You can see the complete list of today’s Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Circle Internet Group, Inc. (CRCL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Total Revenue and Reserve Income: $701 million in Q2, up 7% year over year. USDC in Circulation: Ended the quarter at $73.3 billion, up 19% year over year; average circulation reached an all-time high of $76.5 billion. Revenue Less Distribution Cost Margin: 41.2%, up three percentage points year over year. Adjusted EBITDA: $143 million, up 8% year over year; adjusted EBITDA margin was 50%. Adjusted Operating Expenses: $146 million, up 23% year over year. Other Revenue: $34 million, up 1.4 times year over year. Reserve Return Rate: 3.48% for the quarter, down 66 basis points year over year. USDC on Platform Infrastructure: Increased 106% year over year to $12.4 billion, representing 17% of circulation. Daily Minting and Redemption: Averaged $1.9 billion in Q2, up 105% year over year. On-Chain Transaction Volume: Averaged $163 billion per day in Q2, up 151% year over year; total transactional volume reached nearly $15 trillion. CPN Annualized Total Payment Volume: Nearly $15 billion on a trailing 30-day basis at the end of Q2; reached $23 billion as of July 31st. USYC Assets: Grew 10x year over year to over $3 billion. EURC Growth: Grew 2.2x year over year. ARK Token Presale: $242 million presale executed in Q2. Warning! GuruFocus has detected 6 Warning Sign with CRCL. Is CRCL fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. USDC circulation grew 19% year-over-year to $73.3 billion, with average circulation reaching an all-time high of $76.5 billion, despite a 40% decline in the broader digital asset market. USDC's share of stablecoin transaction volume reached nearly 70% in June, a new record, up from 36% in Q2 last year. The company received its OCC National Trust Bank Charter and a New York limited purpose trust charter, enhancing its regulatory standing and enabling federally supervised digital asset services. ARC mainnet is set to launch on September 16 with a strong cohort of validators, including major financial institutions, and partnerships with DTCC and BlackRock to tokenize securities and deploy BUIDL on the network. CPN annualized total payment volume reached $23 billion as of July 31, up 130% since the last earnings report, with plans to begin monetizing the network in the second half of the year. Other revenue guidance was raised to $310-$330 million, driven by ARC token presale revenue of $242 million, with 75% expected to be recognized in 2026. Digital asset market weakness led to a 40% year-over-year decline in market cap, reducing trading activity and DeFi collateral demand, which impacted USDC circulation growth. Reserve return rate declined 66 basis points year-over-year to 3.48%, reflecting lower SOFR rates, which partially offset revenue growth. Other revenue declined $8 million quarter-over-quarter due to moderating blockchain revenue and a deliberate shift in focus to ARC over other blockchain partnerships. Subscription and services revenue declined $7 million due to fewer blockchain integrations, and transaction revenue declined $1 million from lower validator rewards. Adjusted operating expenses increased 23% year-over-year and 8% sequentially, driven by investments in ARC marketing, infrastructure, and AI capabilities, with guidance expected to land at the higher end of the range. The Hyperliquid arrangement is expected to have a minimal impact on Q2 results, with the full impact to be reflected starting in Q3, potentially affecting future margins. Q: Can you provide more detail on the Hyperliquid arrangement, including the economics and how it will be classified?A: Jeremy Allaire (CEO) explained that Hyperliquid, despite exploring other stablecoin projects, chose USDC due to its liquidity, network effects, institutional preference, and global regulatory availability. He characterized major exchanges like Hyperliquid as "liquidity supernovas" whose concentrated liquidity spins out to affect distribution across many other applications, making the partnership strategically critical. CFO Jeremy Fox-Geen added that at quarter end, approximately 90% of Hyperliquid's total USDC was held on Coinbase's platform and 10% on Circle's platform. He declined to comment on the precise revenue share details between Circle and Coinbase, but noted the impact will be reflected beginning in Q3. Q: How is Circle thinking about competitive positioning and distribution in light of the OUSD announcement, and can Circle replicate the open standards model of sharing reserve income with distribution partners?A: Jeremy Allaire (CEO) emphasized that Circle already has over 150 distribution partnership agreements providing economic incentives to grow USDC, and that this model has been in place for a long time, often in collaboration with Coinbase. He noted that approximately 70% of companies involved in consortium efforts are already building with Circle. He highlighted that Coinbase's CEO reiterated his focus on making USDC the number one stablecoin, and that Circle continues to expand relationships with major firms like Visa and Mastercard, who are becoming key infrastructure partners in ARK. Allaire expressed confidence in Circle's leadership position and its ability to form win-win distribution partnerships where they make sense. Q: What is the roadmap for platform revenue besides passive reserve income, and what should we expect in 2026 and beyond?A: CFO Jeremy Fox-Geen outlined three pillars of the platform: digital assets (USDC and others), payments (CPN), and developer infrastructure (ARK). He noted other revenue has grown from essentially zero to a guided range of around $300 million in 2026. ARK itself will be a diverse revenue source including token presale revenue, staking, transaction fees, and partnership revenue. CPN, which reached $23 billion in annualized TPV as of July 31, will begin monetizing in the second half of this year. He also highlighted that the velocity of product development, accelerated by agentic infrastructure, will continue to expand Circle's product surface area and create new monetization opportunities. Jeremy Allaire added that the addressable market for money is about $120 trillion, with half being non-interest earning, suggesting the reserve income stream is still very early stage. Q: Can you discuss the delay of the Clarity Act passing and its impact on Circle?A: Jeremy Allaire (CEO) stated that the Clarity Act is being actively discussed in the Senate with final issues being negotiated between Democrats and Republicans, with a goal of getting to a motion to proceed this week. He emphasized that for Circle, the GENIUS Act, which passed a year ago and becomes effective in January 2027, is the most critical piece of legislation as it establishes legal digital dollars in the US financial system. He also noted that key regulatory agencies are proactively working on their own rulemaking to support continued maturation and clarity in the space. Q: Does Circle plan to roll out quarterly dividends in the near future?A: Jeremy Fox-Geen (CFO) gave a definitive "no" to this question. He explained that Circle has a massive opportunity to be the leading internet platform company as the world evolves into internet-based financial services. The company believes in retaining a strong balance sheet to invest through market cycles and take advantage of opportunities. He stated that the returns available to shareholders from investing in the platform are far greater than paying out quarterly dividends, positioning Circle as a "massive future market growth stock versus a stock that returns capital to shareholders today." Q: Can you expand on the decision to prioritize ARK over other blockchains and how this impacts the subscription and services component of other revenue?A: Jeremy Allaire (CEO) described ARK as potentially a bigger opportunity than USDC itself, representing the birth of a new operating system layer for economic activity. He noted Circle is a 25% stakeholder and key operator of infrastructure in the network, with attractive margin characteristics and diversification of product SKUs. CFO Jeremy Fox-Geen added that subscription and services revenue is based on partnerships with other blockchains, which have both upfront and recurring components. He acknowledged lumpiness inherent in these contracts due to upfront fees, but emphasized that making USDC available on blockchains where people are building activity remains a priority, with the guidance reflecting the implications for the second half of the year. Q: What is the roadmap for agentic products in the second half of this year, and when should we expect revenue contribution from agentic commerce?A: Jeremy Allaire (CEO) outlined that Circle is working on identity mechanisms, automated discovery systems, and reputation systems for agents, along with simple ways for agent builders to enable earning and monetization. He emphasized an open standards approach and noted organic adoption, citing Cloudflare's recent announcement making agentic wallets with X402 and USDC support a core offering. He stated that the agentic stack will drive stablecoin adoption and ARK infrastructure adoption, which directly accrues to Circle's revenue, though he did not provide specific timing for material revenue contribution. Q: Can you talk about the distribution and transaction costs associated with USDC on Circle's platform, and how did the mix change from Q1 to Q2?A: CFO Jeremy Fox-Geen acknowledged the question but declined to provide disclosure at the level of margin and mix within the platform. He explained that there are pockets of heavily incentivized USDC and very large dispersed surface areas with little incentive, creating movements in every pocket within any quarter. He expressed comfort with the year-end guide, noting that when backing out the $180 million of expected ARK revenue, the trajectory is towards the middle of the previously guided range. Q: Does USDC have an inherent right to win within the X402 stack, and can Circle benefit from more adoption within those payment channels?A: Jeremy Allaire (CEO) confirmed that Circle was an early design partner and founding member of the X402 foundation. He explained that agents want actual digital dollars that can process in fractions of a second for fractions of a cent, which lends itself extremely well to USDC. He noted that even LLMs, as they work with deployed agents, create network effects as the intelligence layer is informed by the utility and scale that exists. He expressed confidence in Circle's For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Circle Internet Group, Inc.? Here are five stocks we like better. Q2 revenue and reserve income rose 7% to $701 million, while adjusted EBITDA increased 8% to $143 million. USDC circulation grew 19% year over year to $73.3 billion, although the reserve return rate fell to 3.48%. USDC network activity accelerated, with daily on-chain transaction volume up 151% to $163 billion. Circle also renewed its Coinbase agreement and said its Arc institutional blockchain mainnet is scheduled to launch Sept. 16, with DTCC and BlackRock partnerships. Circle raised its 2026 other-revenue outlook to $310 million-$330 million, primarily due to expected Arc-related revenue, and lifted its revenue-less-distribution-cost margin forecast to 41.7%-43.7%. Its payments network reached $23 billion in annualized volume as of July 31. Blueprint for a Banking Fortress: Circle Redraws the Map Circle Internet Group (NYSE:CRCL) reported second-quarter total revenue and reserve income of $701 million, up 7% from a year earlier, as growth in USDC circulation and other revenue was partly offset by a lower reserve return rate. USDC circulation ended the quarter at $73.3 billion, increasing 19% year over year, while average circulation reached a quarterly record of $76.5 billion, according to Chief Financial Officer Jeremy Fox-Geen. The reserve return rate was 3.48%, down 66 basis points from the prior-year period, reflecting a decline in SOFR. → 3 Drone Stocks That Should Soar After the Summer Slump Circle’s IBM Patent Deal Could Redraw the Stablecoin Infrastructure Race Adjusted EBITDA rose 8% year over year to $143 million, with an adjusted EBITDA margin of 50%. Revenue less distribution costs margin was 41.2%, up three percentage points from a year earlier. Adjusted operating expenses increased 23% to $146 million as Circle continued to invest in product development, market infrastructure and artificial intelligence capabilities. Chief Executive Officer Jeremy Allaire said USDC transaction activity continued to expand despite weakness in broader digital asset markets. Daily on-chain transaction volume averaged $163 billion during the quarter, up 151% year over year, while total quarterly minting and redemption volume reached $170 billion. Circle said daily minting and redemption averaged $1.9 billion, up 105% from a year earlier. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth MarketBeat Week in Review – 07/06 - 07/10 Circle cited Visa data indicating that USDC accounted for nearly 70% of stablecoin transaction volume in June. Fox-Geen said the figure was up from 36% in the second quarter of the prior year. The company also said that USDC balances held in Circle’s platform infrastructure rose 106% year over year to $12.4 billion, representing 17% of total circulation. The company renewed its agreement with Coinbase under existing terms, Allaire said, keeping USDC central to Coinbase’s products. Circle also addressed competition for stablecoin distribution, saying it has more than 150 distribution partners with economic incentives to support USDC and that it can work with Coinbase on additional distribution arrangements when appropriate. → Jersey Mike's Serves Fresh Gains After IPO Stumble Circle said USDC held on Coinbase’s platform represented 30% of total circulation at quarter-end. Hyperliquid accounted for roughly 6% of that total, according to Fox-Geen. The company said its new arrangement with Hyperliquid had minimal second-quarter financial impact because the migration to Coinbase’s platform occurred late in the quarter, with effects expected to begin appearing in the third quarter. Circle said its Arc Mainnet is scheduled to launch Sept. 16. The company described Arc as financial-market infrastructure designed for institutions and said more than 100 partners were active on its private mainnet ahead of the public release. Arc’s testnet had processed more than 500 million transactions across nearly 3 million wallets, Allaire said. The company announced partnerships with DTCC and BlackRock related to the network. DTCC is collaborating with Circle on tokenized securities, initially focused on enabling tokenization of DTC-custodied assets on Arc. BlackRock plans to deploy its BUIDL fund on Arc, where Circle said native USDC integration could allow institutional investors to subscribe, redeem and deploy fund assets in one on-chain environment. Circle also said it received final approval for an OCC national trust bank charter and later received a limited-purpose trust charter from New York state. Allaire said Circle National Trust will provide a federally supervised foundation for digital-asset services and allow core USDC infrastructure to operate within that framework. Circle Payments Network, or CPN, reached nearly $15 billion in annualized total payment volume on a trailing 30-day basis at the end of the second quarter. The company said the figure rose to $23 billion as of July 31, representing 130% growth since its prior earnings report. CPN had 175 financial institutions at quarter-end, up nearly 30% sequentially, and its products were operating across more than 58 countries, Circle said. Allaire said Circle expects to begin monetizing the payments network in the second half of the year. The company also highlighted growth in other digital assets. EURC increased 2.2 times year over year, while USYC, Circle’s tokenized money market fund, grew tenfold to more than $3 billion in assets, according to Allaire. Circle said it is also investing in agentic-finance tools, including its Agent Stack and support for the x402 payment protocol. Allaire said USDC, alongside protocols including x402, handles 99.3% of agentic payments, and that more than 900 paid services were available in the company’s agent marketplace. Fox-Geen raised Circle’s 2026 other-revenue outlook to between $310 million and $330 million, from a prior range of $150 million to $170 million. The revision was driven primarily by Arc-related revenue. Circle said it completed a $242 million presale of the ARC Token during the second quarter and expects to recognize revenue as product milestones are achieved. Based on its roadmap, the company expects to complete about 75% of those milestones during 2026, contributing approximately $180 million to revised guidance. The remaining products are expected to generate $130 million to $150 million in other revenue. The company raised its full-year revenue-less-distribution-cost margin outlook to 41.7% to 43.7%, from 38% to 40%. It maintained adjusted operating expense guidance of $570 million to $585 million, though Fox-Geen said Circle expects results near the upper end of that range. Circle reiterated its view that a 40% multi-year, through-cycle compound annual growth rate for USDC is achievable. Fox-Geen said the company expects growth to be supported by regulated markets, enterprise adoption, international use cases and broader use of blockchain-based financial infrastructure. Circle Internet Group (NYSE: CRCL) is a financial technology company that builds infrastructure to enable businesses and developers to use and move money on public blockchains. Co-founded by Jeremy Allaire and Sean Neville, the company is best known as a principal issuer and steward of USDC, a dollar-pegged stablecoin developed through the CENTRE Consortium, which Circle co-founded with Coinbase. Jeremy Allaire serves as CEO and has been a visible leader in the company’s strategy and public engagement around digital currency and payments innovation. Circle’s core products and services center on digital currency issuance and programmable payments. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Circle Internet Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

By Jarrett Banks Corpay (NYSE: CPAY) delivered another strong quarter of double-digit organic revenue growth. But increasingly, investors are keyed into management’s capital allocation strategy as a top reason to own the stock. Several analyst notes pointed out that Corpay is evolving into one of the payments industry’s premier capital compounders. JPMorgan said investors should focus on the company’s ability to consistently generate excess cash and deploy it at attractive returns rather than simply evaluating quarterly revenue and earnings results. The bank raised its price target to $470 and raised earnings estimates, citing growing confidence in both operating execution and future capital deployment. At the center of that thesis is CEO Ron Clarke’s long-term financial framework. Management continues to target more than 10% annual organic revenue growth, low-teens pre-tax profit growth and more than 20% annual cash EPS growth. Supporting those objectives is an estimated $15 billion of deployable capital generated through annual free cash flow and expanding debt capacity as earnings continue to grow. Management has made clear that capital will be allocated based on whichever opportunity creates the greatest shareholder value. That could mean acquiring additional Corporate Payments businesses similar to Alpha Group and AvidXchange, or aggressively repurchasing Corpay shares if they offer superior returns. Mr. Clarke even suggested the company could potentially buy back roughly half of its outstanding shares over time if valuations remain attractive. That flexibility significantly expands Corpay’s long-term earnings potential, with JPMorgan noting that if attractive acquisition opportunities emerge, Corpay has demonstrated an ability to integrate businesses that enhance both growth and margins. If acquisitions become less compelling, management has the financial capacity to redirect billions of dollars toward buybacks, providing another avenue to accelerate earnings per share. The company’s operating performance continues to support that strategy. Second-quarter revenue increased 21% to $1.34 billion while organic revenue grew 10% for a fifth consecutive quarter of double-digit expansion. Adjusted earnings per share climbed 36% to $7, allowing management to raise full-year guidance while maintaining its target of approximately 10% organic revenue growth. Corporate Payments remains the primary engine behind that growth. The segment generated 16% organic revenue growth for the second consecutive quarter and now represents approximately 41% of total company revenue, reaching management’s original year-end mix target ahead of schedule. Analysts cited continued Alpha integration, improving contributions from AvidXchange and healthy customer activity as evidence that the business continues gaining momentum. Another important piece of the story is Corpay’s portfolio transformation. The company continues selling businesses it considers non-core while directing more investment toward Corporate Payments, where returns are significantly higher. Analysts generally viewed the Epyx divestiture and previous asset sales as evidence that management is sharpening the company’s focus around its highest-value businesses. That strategic repositioning has prompted analysts across Wall Street to raise both earnings estimates and price targets. Baird, Raymond James, KBW, Oppenheimer, UBS, Deutsche Bank, RBC and Cantor Fitzgerald all highlighted Corpay’s durable double-digit organic growth, improving business mix and disciplined capital allocation as reasons the company could continue outperforming over the next several years. Corpay is no longer being judged solely as a payments processor capable of producing reliable earnings growth. Increasingly, analysts view it as a disciplined capital allocator capable of compounding shareholder value through a combination of consistent operating execution, strategic acquisitions, portfolio optimization and opportunistic share repurchases. And the company’s ability to deploy capital could become an even more powerful driver of future returns than routinely drive stellar quarterly earnings. Contact: Exec Edge [email protected] Click HERE to follow us on LinkedIn The post Corpay’s Price Target Raised by Brokers After Earnings Beat appeared first on ExecEdge.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributes Circle's leadership to deep competitive moats in trust, liquidity, and regulatory standing, holding over 55 licenses across major jurisdictions. The renewal of the Coinbase partnership on existing terms ensures USDC remains central to Coinbase's product ecosystem, reinforcing a critical distribution channel. The receipt of an OCC National Trust Bank charter provides a federally supervised foundation, intended to project Circle's infrastructure into global corporate and capital markets. Performance in Q2 was driven by robust transactional utility, with USDC reaching nearly 70% of stablecoin transaction volume in June despite broader digital asset market weakness. Strategic positioning is shifting toward 'agentic finance,' with management building infrastructure to enable AI agents to earn, monetize, and transact using USDC. The upcoming Arc Mainnet launch is framed as a foundational 'economic operating system' supported by a cohort of global financial institutions acting as network validators. Management maintains a multiyear through-cycle growth framework of a 40% CAGR for USDC circulation, citing massive addressable markets in noninterest-earning money. The Arc Mainnet launch scheduled for September 16 is expected to drive significant 'other revenue' through staking, transaction fees, and token milestones. Guidance for 2026 includes $180 million in revenue from the Arc token presale, with approximately 75% of related product milestones expected to be achieved within the year. Circle plans to begin monetizing the Circle Payments Network (CPN) in the second half of 2026, following a period of scaling that reached a $23 billion annualized volume run rate. The company is transitioning to an 'agentic corporation' model, aiming to orchestrate hybrid teams of humans and AI agents to increase internal product development velocity. Management made a deliberate strategic decision to prioritize Arc development over new blockchain partnerships, leading to a temporary moderation in subscription and services revenue. A $242 million presale of the Arc token was executed in Q2, representing a significant new high-margin revenue stream for the platform. The reserve return rate declined 66 basis points year-over-year to 3.48%, reflecting the downward movement of SOFR during the period. Operating expense guidance was maintained at the higher end of the $570 million to $585 million range to support aggressive investment in AI and Arc infrastructure. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted active bipartisan negotiations in the Senate, though timing for a floor motion remains uncertain. The GENIUS Act, becoming effective in January 2027, is viewed as the more critical bedrock for legal digital dollars in the U.S. financial system. Allaire dismissed the threat of new consortiums, noting that 70% of companies expressing interest in those projects are already active participants in the USDC network. Circle maintains the ability to form win-win distribution arrangements and revenue-share agreements, such as the recent Hyperliquid collaboration with Coinbase. CFO Fox-Geen explicitly ruled out dividends, stating Circle is a 'future market growth stock' that prioritizes reinvesting cash into the platform for long-term returns. The company intends to maintain a strong balance sheet to remain opportunistic through market cycles. Revenue will be derived from stablecoin adoption within AI applications and transaction fees on the Arc infrastructure designed for high-velocity agentic payments. Circle is focusing on open standards for agent identity and reputation to ensure USDC becomes the preferred form of money for AI agents.

Circle Internet Group, Inc. (CRCL) came out with quarterly earnings of $0.18 per share, beating the Zacks Consensus Estimate of $0.16 per share. This compares to earnings of $1.02 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +12.50%. A quarter ago, it was expected that this company would post earnings of $0.15 per share when it actually produced earnings of $0.21, delivering a surprise of +40%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Circle Internet Group, Inc., which belongs to the Zacks Financial - Miscellaneous Services industry, posted revenues of $701.32 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 5.46%. This compares to year-ago revenues of $658.08 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Circle Internet Group, Inc. shares have lost about 20.2% since the beginning of the year versus the S&P 500's gain of 13%. While Circle Internet Group, Inc. has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Circle Internet Group, Inc. was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.27 on $773.72 million in revenues for the coming quarter and $0.86 on $2.98 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial - Miscellaneous Services is currently in the bottom 35% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Bitcoin Depot Inc. (BTMCQ), has yet to report results for the quarter ended June 2026. This company is expected to post quarterly loss of $0.28 per share in its upcoming report, which represents a year-over-year change of -125%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Bitcoin Depot Inc.'s revenues are expected to be $106.4 million, down 38.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Circle Internet Group, Inc. (CRCL) : Free Stock Analysis Report Bitcoin Depot Inc. (BTMCQ) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research