拆解Circle Q1财报：利率红利退潮后，USDC准备下一盘大棋

Original | Odaily Planet Daily (@OdailyChina)

Author: Azuma (@azuma_eth)

On May 11, before the US stock market opened, stablecoin issuer Circle officially released its Q1 2026 financial report.

According to the financial data, Circle's total revenue and reserve income in Q1 was $694 million, slightly below the market expectation of $715 million; EPS was $0.21, higher than the expected $0.18; adjusted EBITDA was $151 million, up 24% year-over-year; net profit was $55 million, down 15% year-over-year.

Affected by the earnings release, CRCL experienced significant volatility in pre-market trading, with an initial gain of nearly 6% gradually erased amidst fluctuations. As of 22:00, CRCL continued to fall sharply after the US market opened, but then quickly reversed course to turn positive, temporarily trading at $115.74, a daily gain of 2.52%.

Key Data Analysis

As the financial report shows, Circle's total revenue and reserve income for this quarter was $694 million, a 20% increase year-over-year, but this interrupted the growth trend seen over several consecutive prior quarters ($579M ➡️ $658M ➡️ $740M ➡️ $770M ➡️ $694M), and also fell short of market expectations.

Circle attributed the slowdown in revenue growth to a decline in the Reserve Return Rate. On December 10, 2025, the Federal Reserve lowered the federal funds rate target range by 25 basis points to 3.5%-3.75%, thereby compressing the yield on Circle's predominantly US Treasury-backed reserve assets.

However, beneath the relatively weaker top-line revenue, Circle's financial report still revealed some encouraging specific data points.

Firstly, Circle's Other Revenue (excluding Reserve Income) reached a new high of $42 million, showing a growth trend over multiple consecutive quarters ($21M ➡️ $24M ➡️ $29M ➡️ $37M ➡️ $42M).

As we detailed in our article earlier today, "Earnings, Legislation, Fed... Circle Faces Three Major Tests This Week", this means Circle's revenue sources are becoming more diversified. Its platform services, API tools, and payment products are generating substantial commercial revenue, reducing its reliance on interest income.

Another noteworthy data point is the RLDC Margin, which is the profit margin after deducting distribution costs from revenue. This reflects the profitability of core operations after distribution expenses and is widely regarded as Circle's most critical profitability metric. Circle's RLDC Margin reached 41% this quarter, achieving growth for four consecutive quarters (36% ➡️ 39% ➡️ 40% ➡️ 41%). This indicates that Circle is becoming more efficient in controlling its distribution costs.

Now, let's look at the expenses. Distribution and Transaction Costs remained Circle's largest expenditure item, amounting to $405 million this quarter, a 17% increase year-over-year. This expense is primarily linked to the USDC distribution contract with Coinbase. This contract is set to expire in August this year. How it is renewed (mainly whether the revenue sharing ratio will be adjusted) will significantly impact Circle's future expenses and profitability.

Excluding distribution costs, Total Operating Expenses surged from $138 million last year to $242 million, a year-over-year increase of 76%. The primary driver of this increase was Compensation expenses, which rose from $75.62 million to $138 million, nearly doubling. Circle explained that this was mainly due to post-IPO stock-based compensation expenses and related taxes.

Affected by the surge in expenses, Circle's operating profit for this quarter fell to $45 million from $92.94 million in the same period last year; net profit attributable to common shareholders decreased to $55.25 million from $64.79 million; earnings per share (EPS) was $0.23, or $0.21 on a diluted basis.

Other Operational Highlights

Beyond the core financial data, Circle also disclosed several operational highlights in its Q1 report.

The most critical data point was that USDC's circulating supply reached 77 billion units at the end of Q1, a 28% year-over-year increase. However, simultaneously, USDC's on-chain transaction volume in Q1 reached a staggering $21.5 trillion, a 263% year-over-year increase. Data from Visa Onchain Analytics also showed that USDC accounted for 63% of total stablecoin transaction volume across the network in Q1.

The transaction volume growth rate far exceeded the circulation growth rate, meaning that the frequency of each USDC being transferred and utilized on-chain has increased significantly — USDC is not statically sitting in wallets but is being genuinely and frequently used for payments, DeFi, cross-border settlements, and other scenarios.

Another key point is that Circle also disclosed that its payment network, Arc Network, has completed a $222 million pre-sale of ARC tokens at a valuation of $3 billion. Investors include prestigious institutions such as a16z, BlackRock, Intercontinental Exchange, Standard Chartered, and SBI. The ARC token whitepaper, also released today, reveals that 60% of the tokens will be allocated to the ecosystem (token sales, developer grants, network growth); 25% will be allocated to Circle (protocol development, staking, and governance); and 15% will be allocated to long-term reserves (strategic flexibility and economic stability).

Additionally, Circle's institutional payment service, Circle Payments Network (CPN), had an estimated annual transaction volume (extrapolated from the 30-day data ending March 31) reaching $8.3 billion. In April, Circle launched the "Managed Payments" product to expand its payment offerings. This product allows financial institutions to launch stablecoin payment services without needing to manage digital assets themselves.

To address the AI agent-driven business future, Circle also announced the launch of Agent Stack, a suite of infrastructure services and tools designed for the AI agent economy, aimed at providing high-speed, low-cost financial service capabilities for autonomously operating AI agents. Circle co-founder and CEO Jeremy Allaire stated in his outlook: "With the pre-sale of ARC tokens, the growing momentum of the Arc Network, and the launch of Agent Stack, we are building trusted infrastructure for AI-native economic activity and a more programmable internet financial system." 

Circle's New Strategic Landscape

Against the macroeconomic backdrop of declining high-interest dividends (Waller's potential succession at the Fed would focus on "rate cuts + balance sheet reduction"), Circle clearly does not want to be entirely constrained by the Fed's interest rate policy. Its strategic focus has quietly shifted towards the diversified expansion of non-interest income.

Based on the details disclosed in this quarterly report, after successively launching services like CPN, Managed Payments, Agent Stack, and Arc Network, Circle's goal is no longer just to be a "stablecoin issuer." Instead, it is attempting to build USDC into the foundational dollar network of the internet era. Under this new vision, Circle's target clients are no longer limited to exchanges or crypto-native users but are extending comprehensively towards cross-border payments, corporate settlements, and even the AI agent economy.

Circle's ambition is now abundantly clear: to completely transform USDC from a "static reserve asset" into "liquid economic lifeblood."This, perhaps, is the grand strategy Circle truly intends to execute.