---
type: "Topics"
locale: "en"
url: "https://longbridge.com/en/dolphin/post/44769621.md"
description: "Circle 3Q26 First Take: The Q3 beat was largely driven by revenue from Arc token sales. Ex-Arc, results were middling, validating pre-earnings investor concerns, with Dolphin Research presenting ex-Arc metrics.1) Reserve interest income declined QoQ: Q3 reserve interest income was 660 mn, down 8% YoY as rates fell despite an 8% YoY increase in USDC market cap. On a QoQ basis, avg. USDC in circulation was 73.3 bn in Q3, down 4% vs. Q2.2) Arc token sales recognized at 180 mn: Other income exceeded 200 mn in Q3, with 180 mn recognized from Arc token sales. The timing and size surpassed the market’s 90 mn expectation and the prior full-year guide of 180 mn. This revenue is unlikely to recur, and with full-year other income still guided at 310-330 mn, Q4 likely has none.3) Big channels push back, increasing pressure to share interest: Major distribution channels are pushing back, increasing pressure to share interest. Because Arc token sales carry negligible cost, the 180 mn was effectively pure profit, inflating Q3 earnings. Ex-Arc and with lower revenue vs. relatively fixed costs, GAAP OPM fell by 100 bps QoQ, pointing to a weaker underlying trend.From Q3 onward, profits will increasingly reflect revenue-sharing from Hyperliquid, and by rough estimates Circle forfeits nearly 100 mn of GP per year, with the impact from channel pushback likely to become evident as early as Q4.3) Full-year guidance unchanged: Versus Q2, full-year guidance for other income and profitability was unchanged. Management also reiterated a multi-year 40% CAGR for USDC circulation. However, near-term confidence in that outlook is close to zero.Over the short to mid term, performance depends on a healthier crypto cycle and broader USDC ecosystem partnerships to fend off multiple competitors, not just USDT but also U.S. banks’ consortium coins. Dolphin Research believes USDC still holds notable advantages over consortium tokens, aside from USDT. Consortium projects may struggle to coalesce due to too many stakeholders. By comparison, the tighter constraint from other financial institutions is the risk of large channels like Hyperliquid demanding interest rebates. This poses a meaningful impact for Circle.$Circle(CRCL.US)"
datetime: "2026-11-04T13:26:02.000Z"
locales:
  - [en](https://longbridge.com/en/dolphin/post/44769621.md)
  - [zh-CN](https://longbridge.com/zh-CN/dolphin/post/44769621.md)
  - [zh-HK](https://longbridge.com/zh-HK/dolphin/post/44769621.md)
author: "[Dolphin Research](https://longbridge.com/en/dolphin.md)"
generator: "portal-rs"
---

# Circle 3Q26 First Take: The Q3 beat was largely dr…


### Related Stocks

- [CRCL.US](https://longbridge.com/en/quote/CRCL.US.md)
- [CCUP.US](https://longbridge.com/en/quote/CCUP.US.md)
- [CRCG.US](https://longbridge.com/en/quote/CRCG.US.md)
- [CRCD.US](https://longbridge.com/en/quote/CRCD.US.md)
- [CRCO.US](https://longbridge.com/en/quote/CRCO.US.md)

---
> **Disclaimer: This article is for reference only and does not constitute any investment advice.**