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    CRCL
    Earnings call· Mar 2026(Q1 FY26)

    Circle Internet Group Q1 FY26 earnings call CRCL

    May 11, 2026 Source

    Executive summary

    Circle Internet Group Q1 FY26 — Arc Token Presale and Strong USDC Transaction Growth

    Circle Internet Group is positioning itself at the convergence of AI operating systems and blockchain-based economic operating systems, aiming to transform global economic activity. The company reported strong Q1 FY26 results driven by significant USDC transaction volume growth and the successful presale of its Arc token. Circle is expanding its full-stack platform with new product launches like the Circle Agent stack and CPN managed payments, while also navigating a stablecoin market that was sequentially flat but saw USDC gain significant market share in onchain transactions.

    Highlights

    5

    • USDC onchain transaction volume grew 263% year-over-year to $21.5 trillion in Q1 FY26.

    • Adjusted EBITDA grew 24% year-over-year to $151 million in Q1 FY26.

    • Total revenue and reserve income grew 20% year-over-year to $694 million in Q1 FY26.

    • The Arc token presale raised $222 million at a $3 billion fully diluted network value.

    • CPN annualized total payment volume is approaching $10 billion as of May 7, up nearly 75% since last reported.

    Concerns

    3

    • USDC circulation ended the quarter at $77 billion, roughly flat sequentially.

    • The reserve return rate was 3.5% for the quarter, down 66 basis points year-on-year.

    • Transaction revenue declined to $6.7 million from the prior quarter, which included a $7 million benefit from the Canton coin launch.

    Guidance & targets

    1
    CategoryTargetConfidence
    Full-year 2026 guidance
    Unchanged
    high materiality
    High

    Operational metrics

    22
    USDC circulation
    $77 billion28% year-on-year growth; roughly flat sequentially
    Q1 FY26

    Represents 18% of total circulation held within Circle's platform infrastructure.

    USDC onchain transaction volume
    $21.5 trillion263% year-on-year growth
    Q1 FY26

    Excludes Solana transaction volume.

    USDC onchain transaction volume (including Solana)
    $30 trillion
    Q1 FY26

    According to other third-party data sources.

    USDC market share (Visa commercial transactions)
    63%
    Q1 FY26

    Continued to gain market share.

    USDC market share (all onchain transaction volume)
    80%
    Q1 FY26

    According to third-party data sources including Solana transaction volume.

    USDC minted and redeemed
    $150 billion
    Q1 FY26

    Providing reliable and compliant digital dollar dial tone.

    EURC circulation
    EUR 358 million2x year-on-year growth
    Q1 FY26

    World's largest euro stablecoin.

    USYC assets
    $3 billionover 300% year-on-year growth
    as of May 7

    Largest tokenized money market fund in the world.

    CPN annualized total payment volume
    $8.3 billion17% quarter-over-quarter growth
    Q1 FY26 (trailing 30-day)

    Reflects growth in B2B cross-border flows.

    CPN annualized total payment volume
    $10 billionnearly 75% growth since last reported
    as of May 7

    Reflects growth in B2B cross-border flows.

    Financial institutions enrolled in CPN
    13636% quarter-over-quarter growth
    Q1 FY26

    Reflects adoption of CPN products.

    X402-Agentic payments using USDC
    99.8%
    Q1 FY26

    USDC is the dominant form of payment in AI agent protocols.

    AI tools weekly active users (employees)
    85%
    Q1 FY26

    Rapid uptake of AI coding tools and automations.

    AI native apps deployed
    600
    YTD FY26

    Capitalizing on major breakthroughs in agentic and AI development.

    Adjusted operating expenses
    $136 million32% year-on-year growth
    Q1 FY26

    Continued investment in product, distribution, and operating infrastructure.

    Revenue less distribution cost margin
    41.4%1.5 percentage points year-on-year increase; 1.3 percentage points quarter-over-quarter increase
    Q1 FY26

    Driven by growth in USDC held on platform and other revenue, partially offset by mix shift.

    Other revenue
    $42 million2x year-on-year growth
    Q1 FY26

    Grew quarter-over-quarter despite a prior quarter benefit from Canton coin launch.

    Subscription and services revenue
    $34.9 million
    Q1 FY26

    Primarily from blockchain network partnerships.

    Transaction revenue
    $6.7 millionexpected decline from last quarter
    Q1 FY26

    Last quarter included a $7 million benefit from the Canton coin launch.

    Reserve return rate
    3.5%66 basis points year-on-year decline
    Q1 FY26

    Reflecting the decline in SOFR during this period.

    USDC held within Circle's platform infrastructure
    $13.7 billion3.5x year-on-year growth
    Q1 FY26

    Reflects growth in on-platform activity.

    Arc token value on balance sheet
    0
    Q1 FY26

    Arc tokens are held at cost on Circle's balance sheet.

    Industry KPIs

    3
    MetricValueDetails
    Revenue growth$694 millionUSD
    Customer account count136financial institutions
    Ai product adoption monetization99.8%%

    Orderbook & backlog

    1
    Cross-chain transfer protocol (CCTP) volume$50 billionQ1 FY26

    3x growth

    Product announcements

    4
    ProductTypeDetails
    Circle Agent stacklaunch
    CPN managed paymentslaunch
    Arc token presalelaunch
    SERBTC (Bitcoin product)roadmap

    Deals & partnerships

    22
    MetaUsing USDC for creator payouts

    Demonstrates major enterprises integrating USDC rather than building their own stablecoins.

    DoorDashPaying out USDC to drivers

    Example of global enterprises embracing USDC in their payment flows.

    PolymarketAdopting USDC for funding and settlement

    Used on their leading prediction market.

    Arbor BankUsing USDC to power 24/7 banking

    Innovative financial institution leveraging USDC.

    Top exchanges in KoreaExpanded relationships

    Thriving market with significant growth opportunities for USDC.

    DTCCParticipating in a test run of Tokenized Securities Trading

    Expansion in capital markets with USDC as collateral on regulated derivatives exchanges.

    KyribaBroad partnership to make USDC payment flows seamless

    Kyriba is a leading treasury management platform serving thousands of enterprises and many Fortune 100 companies.

    RampAdopting USDC for international and domestic use cases

    Ramp is one of the fastest-growing fintechs in enterprise treasury and payments.

    Y CombinatorDriving funding operations in USDC

    Cross-border and treasury flows increasingly moving to USDC across the start-up ecosystem.

    A16Z cryptoLead investor in Arc token presale$222 million

    Part of a broad group of strategic partners for the Arc token presale.

    Apollo FundsInvestor in Arc token presale

    One of the world's largest asset managers participating in the presale.

    Arc InvestInvestor in Arc token presale

    One of the world's largest asset managers participating in the presale.

    BlackRockInvestor in Arc token presale

    One of the world's largest asset managers participating in the presale.

    Janus Henderson InvestorsInvestor in Arc token presale

    One of the world's largest asset managers participating in the presale.

    BullishInvestor in Arc token presale

    Exchange, fintech, and capital markets firm participating in the presale.

    Intercontinental ExchangeInvestor in Arc token presale

    Exchange, fintech, and capital markets firm participating in the presale.

    Marshall WaceInvestor in Arc token presale

    Exchange, fintech, and capital markets firm participating in the presale.

    SBI GroupInvestor in Arc token presale

    Exchange, fintech, and capital markets firm participating in the presale.

    Standard Chartered VenturesInvestor in Arc token presale

    Leading global bank participating in the presale.

    General CatalystInvestor in Arc token presale

    Venture firm participating in the presale.

    Hahn VenturesInvestor in Arc token presale

    Venture firm participating in the presale.

    IDG CapitalInvestor in Arc token presale

    Venture firm participating in the presale.

    Risks & headwinds

    4
    Stablecoin market sequential flatnessQ1 FY26

    USDC circulation roughly flat sequentially at $77 billion

    Mitigation: Focus on driving utility, expanding global reach, and increasing partnerships and use cases for USDC. Building Arc network to drive new applications.

    Digital asset market declinesince October 2025

    45% decline in digital asset markets since their peak in October 2025

    Mitigation: Underlying growth in non-crypto utility and use cases for USDC, which held up despite broader market decline.

    Modest pullback in highly incentivized channelsQ1 FY26

    Modest pullback in certain highly incentivized channels

    Mitigation: Management views this as part of normal market dynamics, with overall strong RLDC margin for the quarter. Focus on long-term growth and diversified partnerships.

    Hacks and breaches in interoperability infrastructurerecent past

    Breach of an interoperability infrastructure company, exploited through other DeFi protocols

    Mitigation: Circle's focus on foundational security, post-quantum readiness roadmap, and building institutionally ready onchain protocols with strong control structures. CCTP's safety and reliability are highlighted.

    What to watch in Q2 FY26

    5

    Arc MainNet launch

    soon
    CurrentTestnet performed very well
    TargetMainNet launched and operational

    Why it matters

    Arc is a core component of Circle's strategy to build a new economic OS and drive stablecoin-native finance.

    Arc is getting ready for lift-off with the ArcMainNet launch coming soon.

    Q&A highlights

    6

    How much adoption has there been for the Circle Agent stack, and what are the expected achievements for agentic commerce using stablecoins?

    The Circle Agent stack enables AI agents to store value and transact safely. While agentic technology is new, every enterprise conversation focuses on applied AI. USDC already dominates agent payment protocols like X402 (99.8% of transactions). Management believes a meaningful portion of current activity is AI-driven and expects continued growth as AI and economic operating systems converge.

    “USDC represents 99.8% of all the transactions that are happening.”

    asked by James Yaro · answered by Jeremy Allaire

    2 min read6 chapters

    Detailed Narrative

    01

    AI and Blockchain Convergence Strategy

    Circle's core strategy is built on the convergence of new operating systems for intelligence (AI) and economic activity (blockchain). This forms a new Internet stack expected to transform the global economic system. The company believes AI-powered software machines coordinating on blockchain computers will deliver an increasing share of global economic activity, aligning with Circle's vision and mission.

    02

    USDC Growth and Market Leadership

    USDC circulation ended Q1 FY26 at $77 billion, up 28% year-over-year, though flat sequentially. Onchain transaction volume for USDC grew 263% year-over-year to $21.5 trillion, with other third-party data sources putting volumes at nearly $30 trillion and market share at approximately 80% of all onchain transaction volume. Circle minted and redeemed nearly $150 billion of USDC in Q1 alone, reinforcing its position as the most liquid digital dollar.

    03

    Arc Network and Token Presale

    The Arc network is preparing for its MainNet launch, designed as an institutionally ready network for asset issuers, payment terms, and capital markets applications. Circle announced a presale of the Arc token, raising $222 million at a $3 billion fully diluted network value, with participation from major asset managers, banks, and venture firms. The Arc token aims to bootstrap the network, align participants, and enable governance and security functions.

    04

    Circle Agent Stack and AI Integration

    Circle launched its Agent stack, including agent wallets for permissionless onchain transactions, Agent Nano payments for high-frequency machine-to-machine payments, and an agent marketplace with over 500 endpoints. USDC already accounts for 99.8% of X402-Agentic payments. Internally, Circle is undergoing an AI transformation, with 85% of employees using AI tools weekly and over 600 AI-native apps deployed this year.

    05

    CPN Expansion and Managed Payments

    Circle's CPN (Circle Payments Network) product line is growing, with annualized total payment volume on a trailing 30-day basis reaching $8.3 billion, up 17% quarter-over-quarter. As of May 7, it's approaching $10 billion, up 75% since the last report. The company introduced CPN managed payments to simplify stablecoin network adoption for banks and financial institutions by offloading licensing, liquidity, and compliance complexities as a managed service.

    06

    Regulatory Environment and CLARITY Act

    The potential CLARITY Act is seen as crucial for providing legal certainty for financial institutions to engage with digital assets at scale. It specifically addresses stablecoin use cases by banks and broker-dealers. Management views the Act's provisions on stablecoin rewards, which incentivize real-world utility like payments and remittances, as beneficial and superior to the status quo, aligning with Circle's focus on driving utility and velocity.

    AI-generated summary of the company’s earnings call. Not investment advice.