Circle’s Reserve Income Rose 5.3% as USDC Circulation Grew in Q2

Circle’s reserve income grew more slowly than average USD Coin (USDC) circulation in the second quarter, as higher token balances were partly offset by lower returns on the assets backing the stablecoin.

The company recorded $701.315 million in combined revenue and reserve income for the quarter ended June 30, up 6.6% from a year earlier. That total included $667.733 million in reserve income and $33.582 million in other revenue.

Average daily USDC circulation increased 25.2% year over year. USDC in circulation stood at $73.3 billion at quarter’s end, up 19% from a year earlier. The average daily figure and the quarter-end balance measure circulation at different points in time.

Reserve income rose $33.459 million, or 5.3%, from the second quarter of 2025. Circle estimated that higher average daily USDC circulation added about $147.4 million to reserve income, while lower average yields reduced it by about $113.9 million.

Circle Chief Financial Officer Jeremy Fox-Geen said the reserve return rate was “3.48% for the quarter, down 66 basis points year-on-year.” He linked the decline to lower short-term interest rates during the period.

Circle earns interest and dividends on assets backing USDC and records that income before distribution costs. Its reserve income therefore reflects both the amount of USDC in circulation and the returns on the assets held against it. The company’s rate-sensitivity analysis also discusses how reserve returns affect its income.

Net income from continuing operations was $48.214 million, compared with a $482.1 million loss in the year-earlier quarter. Lower stock-based compensation following Circle’s 2025 initial public offering accounted for much of the improvement.

Distribution, transaction and other costs totaled $412.470 million, while operating expenses were $254.486 million. Distribution costs tied to Circle’s agreements with Coinbase totaled $324.6 million in the quarter.

Circle scheduled its third-quarter results webcast for 8 a.m. ET Wednesday, Nov. 4.