W3 — Circle financial statements decoded: 64% growth, $70M GAAP loss
W Insights · W3 · May 11, 2026 · ~8 min read
Circle financial statements for FY2025 paint a paradox: blistering 64% revenue growth alongside a $70M GAAP net loss. Adjusted EBITDA more than doubled to $582M, yet the income statement still shows red. We decode the gap with numbers.
Series Part 3 · The Digital-Dollar Race in the AI Era (5-part series) · Previously: Part 1 “What is a stablecoin?”, Part 2 “Circle’s business model — 96% of revenue is Treasury interest”
Part 2 established that Circle’s business model is essentially “Treasury investing financed by USDC issuance.” In this installment we dissect the Circle financial statements that resulted from that model. Primary source material is available on the Circle filings page at SEC EDGAR.
Circle’s 2025 fiscal year was a strange year in which manic growth and a GAAP net loss coexisted. Total revenue jumped 64%, adjusted EBITDA spiked 104%, yet the reported income line printed a $70M loss. How is that possible? Let’s walk through the data.
📑 In this article
- Circle financial statements at a glance — six headline numbers
- Quarterly revenue and EBITDA trajectory
- Cost structure — where is the money going?
- Why a $70M net loss despite 64% growth — the IPO effect
- USDC circulation and revenue: the linked pair
- Balance-sheet health and FY2026 guidance
1. Circle financial statements at a glance — six headline numbers
Start with the table. FY2024 and FY2025 side by side.
| Line item | FY2024 | FY2025 | YoY |
|---|---|---|---|
| Total revenue + reserve income | $1,676M | $2,747M | +64% |
| Reserve interest income | $1,661M | $2,637M | +59% |
| Other revenue | $15M | $110M | +633% |
| RLDC* | $762M | $1,083M | +42% |
| Adjusted EBITDA | $285M | $582M | +104% |
| Net income (loss) | $157M | ($70M) | to loss |
* RLDC = Revenue Less Distribution Costs | Source: Circle FY2025 Annual Report
The most striking takeaway is that every headline operating metric in the Circle financial statements grew by double digits or more. Other revenue surged 633% and EBITDA doubled — a clear signal that operating leverage is finally kicking in.
But look at the bottom line: net income flipped from +$157M to -$70M. How can revenue grow 64% and earnings still go negative? Section 4 unpacks the answer in detail, but the short version: one-time costs tied to the June 2025 IPO.
2. Quarterly revenue and EBITDA trajectory
Annual numbers smooth over momentum. The quarterly cut makes Circle’s run-rate much clearer.
- Q1 2025: revenue $579M, EBITDA $105M
- Q2 2025: revenue $658M (+14% QoQ), EBITDA $122M (+16% QoQ)
- Q3 2025: revenue $740M (+12% QoQ), EBITDA $148M (+21% QoQ)
- Q4 2025: revenue $770M (+4% QoQ), EBITDA $167M (+13% QoQ)
Q4 is the eye-catcher: revenue +77% YoY, EBITDA +412% YoY, with EBITDA margin reaching 54%. Compare that with the 25–35% margin typical for software platforms, and you see why Wall Street is paying attention.
Why is the margin so high? It comes back to the business model from Part 2. USDC issuance scales without a proportional rise in operating cost, so each incremental dollar of revenue drops to the bottom line. Adding $100M of USDC to circulation barely moves Circle’s headcount or infrastructure spend.
Circle delivered powerful operating leverage in its first year as a public company. Revenue grew 64% while EBITDA grew 104% — every 1% in revenue produced 1.6% in EBITDA. Sustain that ratio and a 2× rise in USDC circulation could mean roughly 3× in profit.
3. Cost structure — where is the money going?
We’ve covered the revenue mix. Now look at the cost side. Circle’s Q4 spend looked like this:
| Cost item | Q4 2025 | YoY | Note |
|---|---|---|---|
| Distribution & transaction | $461M | +52% | Paid to Coinbase and others |
| Operating expenses (GAAP) | $254M | +95% | Headcount & G&A |
| Adjusted opex | $144M | +32% | Ex one-time items |
The insight is here: adjusted opex grew only 32% while revenue grew 77%. Revenue is outrunning cost by more than 2×, which is exactly what drives the EBITDA-margin expansion.
GAAP opex spiked 95% because it absorbed $424M of one-time stock-based comp tied to the IPO. That charge will not repeat, which is why most analysts focus on the adjusted line.
4. Why a $70M net loss despite 64% growth — the IPO effect
Here is the question the Circle financial statements most often confuse readers on: why the $70M GAAP loss?
When Circle IPO’d in June 2025 it had to recognize roughly $424M of stock-based compensation promised to employees all at once on the income statement. No cash left the building — it is an accounting entry.
Strip out the $424M and core operating profit is roughly +$354M.
Think of it this way: the founder promised employees stock options “when we go public,” and when the company actually went public, the entire promise hit the books in a single period. That charge largely will not repeat, so FY2026 reported net income has a high probability of swinging strongly positive.
Why Wall Street weighs adjusted EBITDA over reported net income when valuing Circle — within the Circle financial statements the $70M loss is one-off, while $582M EBITDA is the sustainable shape of the business.
Circle FY2025 Annual Report
5. USDC circulation and revenue: the linked pair
Circle’s revenue is essentially a function of USDC circulation. In Q1 2024 USDC float was $33B and quarterly revenue was $380M; by Q4 2025 float reached $75.3B and revenue hit $770M. Float roughly 2.3×, revenue roughly 2×.
Three companion metrics to track:
- USDC float: $44B (end-2024) → $75.3B (end-2025), +72% YoY
- USDC on-chain volume: $11.9T in Q4 2025 alone — +247% YoY
- On-platform USDC (held inside Circle’s own infrastructure): $12.5B — +460% YoY
The interesting part is that transaction volume is growing far faster than the float. USDC is gradually shifting from a passive store of value into an active payments and remittance currency. The same dollar is being used more times, more often.
6. Balance-sheet health and FY2026 guidance
Balance-sheet health — virtually no debt
The balance sheet inside the Circle financial statements is in solid shape. There is almost no debt, and USDC reserves are 100% backed by short-dated U.S. Treasuries and cash. That means any USDC holder asking for $1 back can be paid immediately — the structural advantage over USDT and one of the reasons institutional investors prefer USDC.
Circle also generated $473.5M in operating cash flow in 2025, with consensus pointing to roughly $516M in 2026. The GAAP loss didn’t stop real cash from coming in the door.
FY2026 guidance
Management’s FY2026 guidance reads as follows:
- USDC circulation: multi-year average 40% CAGR target
- Other revenue: $150M–$170M (≈50% above FY2025’s $110M)
- RLDC margin: 38%–40%
- Adjusted opex: $570M–$585M
The most meaningful line in the guide is “other revenue +50%”. That tells you management is actively trying to reduce dependence on Treasury interest income. If the new products (Arc, CPN, EURC) deliver on schedule, those will begin showing up in the top line — exactly the topic of Part 4.
- FY2025 total revenue $2.747B (+64%), adjusted EBITDA $582M (+104%) — strong operating leverage confirmed
- The $70M GAAP loss is the result of $424M of one-time IPO-linked stock comp; operating result is positive
- Q4 EBITDA margin of 54% sits well above the IT-platform average
- USDC float +72%, on-chain volume +247% — USDC is becoming an active payments rail
- FY2026 other-revenue +50% target signals the start of the new-product contribution
FAQ (Q&A)
Q1. Isn’t a P/E of 99× simply expensive?
By traditional standards, yes. But the IPO one-off distorts GAAP EPS, so EV/EBITDA (~43×) and EV/Revenue are the more accurate yardsticks. Part 5 will dig into this.
Q2. Is quarterly revenue growth slowing?
Q3→Q4 growth did slow to 4%. But Q4 also saw a broader crypto pullback that temporarily reduced USDC float. Q1 2026 will be the real test.
Q3. What does the strong operating cash flow really mean?
GAAP net income can be distorted by many factors; operating cash flow (OCF) reflects real money coming in from the business. Circle’s $473.5M OCF says the underlying engine is generating healthy cash regardless of the headline loss.
Q4. Can a Korean retail investor buy CRCL?
Yes. As an NYSE-listed name, CRCL is available through every major Korean broker’s overseas-equities service (Kiwoom, Toss, Mirae Asset, Samsung Securities, etc.). Note FX costs and the capital-gains regime when sizing positions.
📊 Next up — Circle’s future runs on Arc
Part 4 dives into the businesses Circle built to escape pure Treasury dependence — Arc blockchain, Circle Payments Network, EURC, and USYC. We unpack what 100+ institutional partners (Goldman Sachs, Visa, and others) joining Arc means at mainnet launch, plus the implications of the projected $4T RWA market.
👇 Which number in the Circle financial statements struck you most? EBITDA +412%? Other revenue +633%? Drop a comment.
※ This article is for informational purposes only and is not investment advice.
※ Sources: Circle SEC EDGAR filings, Circle FY2025 Annual Report (filed 2026-02-25), Circle Q4 earnings call transcript, Yahoo Finance, The Motley Fool, Stockanalysis.com (as of May 2026).
