Shares of Circle Internet Group (CRCL 12.44%) took a fall on Wednesday morning, following the stablecoin manager's second earnings report as a public company. The price drop maxed out just before noon ET at 11.4%.
Circle's Q3 2025 by the numbers
Circle's third-quarter revenue rose 66% year over year, landing at $740 million. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped from $126 million to $166 million.
Image source: Getty Images.
The analyst community didn't provide estimates for this report, as Circle's initial public offering (IPO) in June remains too fresh. Many of the banks that would offer these projections may have been involved in the IPO and prohibited from posting advice until their lock-up period ends later this week.
NYSE: CRCL
Key Data Points
Circle's management updated their full-year guidance based on these results, though. The fiscal year's expected operating expenses were raised by $20 million, while other revenues saw a $15 million increase. These updates almost exactly cancel each other out in the context of much more revenue. Circle noted that its headcount is rising quickly, along with strong interest in the company's value-added subscription services.
Circle's digital bread and butter
The bulk of Circle's business remains managing the USDC (USDC +0.00%) stablecoin, of course.
The active USDC circulation more than doubled year over year to $73.7 billion. The company earns revenue from collecting interest on the cash backing for USDC, chiefly in the form of U.S. Treasury Bills and other ultra-stable investments with modest interest rates. By the end of the reported quarter, Circle balanced $73.4 billion of cash and liquid investments against $73.3 billion of cash deposits from stablecoin owners. There is no debt-based backing here. The USDC stablecoin is financed by people buying it with traditional fiat currencies via crypto-trading exchanges such as Binance and Bullish (BLSH +0.24%).
The negative market reaction may look strange, since the financial results looked impressive and Circle held its overall revenue guidance stable. Then again, the stock has been richly valued since the splashy IPO, and it's not always good enough to reiterate earlier guidance targets -- enthusiastic investors were looking for a raise.
The next report should be more traditional with plenty of analyst estimates and a slightly longer history of published results. Until then, Circle's overheated stock should continue to cool down. I recommend watching that process from the sidelines.
