Circle Internet Group, the company behind the USDC stablecoin, announced layoffs affecting about 5% of its workforce during the third quarter of 2026. The cuts, which cost $9.1 million primarily in severance and notice pay, came despite a profitable quarter. Circle's net income from continuing operations rose 5% to $226 million, while total revenue and reserve income climbed 17% to $865 million. However, much of this growth was driven by a one-off gain of $182 million from the presale of the ARC token for its Arc blockchain.
The layoffs were framed as part of aligning the company's structure with its strategy. Circle's main income source, interest earned on the cash and Treasuries backing USDC, has been shrinking. The rate earned on reserves dropped to 3.5%, down 0.61 percentage points, reflecting lower yields on Treasuries due to Federal Reserve rate cuts. USDC in circulation remained flat at $73.9 billion, and its market share slipped 1.83 points to 27%.
Operating expenses rose 16% to $244.9 million, though Circle maintained its full-year adjusted expense guidance of $570 million to $585 million. The company has previously cut jobs, reducing its workforce by less than 6% in December 2024. Circle is also expanding into newer areas, such as its payments network, which hit $41.3 billion in annualized volume, and the planned acquisition of payments firm Tazapay.
Despite the layoffs, Circle remains optimistic about USDC growth, guiding for 40% yearly growth over several years, a target unchanged despite flat circulation. The results were announced alongside other crypto earnings reports from companies like Block and Riot Platforms.