Circle Beats Wall Street, Then Wall Street Beats Circle Stock Back 📉

Circle Internet Group's shares slipped in pre-market trading on Tuesday after the USDC issuer reported second-quarter fiscal 2026 earnings that surpassed net income and earnings-per-share expectations, yet fell short on revenue. The stock had climbed roughly 7% immediately following the release before reversing course, leaving CRCL lower on the session. Circle did not immediately respond to requests for comment outside regular business hours.

The company posted Q2 net income of $590 million, or $1.31 per share, topping analyst consensus of $1.18 per share on earnings, according to data referenced by the company. Revenue came in at $1.69 billion, below the $1.74 billion Wall Street had projected. USDC circulation stood at $61.6 billion at quarter-end, up 3.4% quarter-over-quarter, with 6.4 million USDC wallets active on-chain and more than $733 billion in on-chain USDC transaction volume recorded during the quarter.

Circle raised its full-year outlook, lifting USDC growth guidance to 15% quarter-over-quarter and increasing revenue guidance to a range of $2.6 billion to $2.6 billion, according to a company release. The USDC reserve portfolio generated $589 million in net interest and other revenue, and the company reported $1.13 billion in total net cash flow from operations. Circle also announced a $1.0 billion stock-buyback authorization and confirmed it had begun quoting USDC in yen on the Solana network.

In a note circulated Tuesday, JPMorgan analyst Nathan Hutchinson reiterated a bearish stance on Circle, citing what he described as a disconnect between the stock's elevated valuation and the company's fundamental metrics. Hutchinson reiterated an Underweight rating on CRCL with a December 2026 price target of $80, implying roughly 32% downside from the prior close. The full text of Hutchinson's note was disclosed in JPMorgan's research portal and cited by market participants.

The mixed print marked Circle's second quarterly report since its IPO earlier this year, and came against a broader backdrop of stablecoin-issuer scrutiny from U.S. regulators. Circle executives said on the post-earnings call that deposit insurance coverage from institutions like Bank of New York Mellon and BlackRock money-market allocations continued to anchor USDC reserves, and noted ongoing discussions with U.S. federal banking authorities regarding future GENIUS Act implementation rules.