You should read the following discussion of our financial condition and results of operations in conjunction with our unaudited Condensed Consolidated Financial Statements, including the notes thereto, included elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025. In addition to historical information, the following discussion and analysis contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results and the timing of events could differ materially from those anticipated in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in the “Risk Factors” section. Executive Overview In the second quarter of 2026, we continued building the infrastructure for an open, programmable internet financial system by scaling adoption of USDC and expanding our platform across product and network milestones. During the second quarter of 2026 (compared to the second quarter of 2025): •USDC in circulation grew 19% to $73.3 billion; USDC onchain transaction volume grew 151% to $14.8 trillion. •Total revenue and reserve income grew 7% to $701 million. •Net income (loss) from continuing operations increased by $530 million to $48 million. •Adjusted EBITDA grew 14% to $143 million. See “—Non-GAAP Financial Measures” below for a reconciliation of Adjusted EBITDA to net income (loss) from continuing operations, the most closely comparable GAAP measure, and additional information about the limitations of our non-GAAP measures. Overview of Business Our mission is to raise global economic prosperity through the frictionless exchange of value. We were founded in 2013, on the belief that we could connect the world more deeply by building a new global economic system on the foundation of the internet, and facilitate the creation of a world where everyone, everywhere can share value as easily as we can today share information, content, and communications. We are building a full-stack internet financial platform business anchored by our stablecoin network. Our business is organized around three reinforcing pillars: (i) Arc, an open Layer-1 blockchain network and related developer/interoperability infrastructure; (ii) Circle Digital Assets and Services, including USDC, EURC, USYC, cirBTC, and related liquidity infrastructure such as Circle Mint and xReserve; and (iii) Circle Applications, including products like CPN and StableFX that deliver real-world utility on Arc and across a multichain ecosystem. The three pillars of our platform are designed to reinforce one another: Arc is expected to provide an enterprise-grade foundation for stablecoin finance and consumer-scale applications; Circle Digital Assets and related services supply trusted units of value and liquidity infrastructure; and Circle Applications translate that infrastructure into real-world utility for institutions, developers, and end-users. Our business model is driven by the growth of our platform, including the use and continued utility of Circle Digital Assets. We invest in expansion of our platform by partnering with major financial and technology institutions to drive distribution of Circle Digital Assets, building global fiat on- and off-ramps to increase accessibility and liquidity of Circle Digital Assets, and providing developer tools and operational infrastructure that reduce friction and enable new applications using our Circle Digital Assets, including tools that can be used on our platform without a direct relationship with us. We also aim to increase network activity through the launch of new products and services, expansion into new markets, and the fostering of third-party innovation on our platform, in each case, with a regulation-first approach. 39 Circle stablecoins and related reserve income We currently derive a substantial majority of our revenue from reserve income on the reserve assets backing our stablecoins, USDC and EURC. Reserve income was 95.2% and 94.6% of our total revenue in the three and six months ended June 30, 2026, respectively. Reserve income was 96.4% of our total revenue in both the three and six months ended June 30, 2025. We earn reserve income on the reserve assets backing our stablecoins in circulation at interest rates close to the prevailing SOFR during the applicable periods. We term the rate of return generated on assets held in reserve as the “reserve return rate”. See “—Key operating indicators and financial results” for the calculation of reserve return rate. The reserve income that we generate is a function of (i) our stablecoins in circulation over a given period and (ii) the reserve return rate. Other products In addition to revenue from reserve income on the reserve assets backing our stablecoins, we continue to expand product offerings and services that benefit from and support the growth of our platform and the utility of Circle Digital Assets. Our other products contributed between 4.8% and 5.4% of Circle’s total revenue in both the three and six months ended June 30, 2026, respectively. Our other products contributed 3.6% of Circle's total revenue in both the three and six months ended June 30, 2025. We believe these and other new product and service offerings will contribute to the growth of our platform and the use of Circle Digital Assets, and over time drive a flywheel of growth that has been the hallmark of successful internet-driven networks. We also expect growth in our network to drive increases in our stablecoins in circulation and thereby drive our reserve income. We anticipate growing these offerings in the coming years, diversifying our revenue profile. These offerings include: •Arc Blockchain and Related Developer Infrastructure – Arc is our open, Layer-1 blockchain purpose-built to bring real world economic activity onchain, supported by our Agent Stack (consisting of Agent Wallets, Nanopayments, Agent Marketplace and Circle CLI), core developer services (including App Kits, Circle Wallets and Circle Contracts) and interoperability services (including CCTP and Gateway) designed to reduce complexity and help developers and enterprises build and operate onchain applications that move value across networks. •Circle Tokenized Funds – Our tokenized fund, USYC, which is a part of our Circle Digital Assets, is an onchain representation of shares in a traditional money market fund intended primarily for use as collateral in digital asset markets, providing yield to token holders and complementing USDC and EURC in institutional trading, treasury, and collateral workflows. •Circle Liquidity Services – Circle Mint and xReserve provide institutional liquidity and trust infrastructure for Circle Digital Assets, including minting, redeeming, and moving USDC and EURC through Circle Mint, and enabling third-party developers to deploy USDC-interoperable stablecoins through xReserve. •Circle Applications – Our application-layer products build on Circle Digital Assets and Arc to deliver practical utility, including CPN, which connects eligible financial institutions to facilitate near-instant, 24/7/365 payment settlement using regulated stablecoins, and StableFX, an institutional stablecoin foreign exchange engine built on Arc that supports onchain settlement and configurable escrow-based trade settlement. See Part I, Item 1 – “Business”, of our Annual Report on Form 10-K for the year ended December 31, 2025 for a detailed description of our suite of products and services. Recent Developments Arc and the ARC Token As previously announced in October 2025, we launched the public testnet of Arc, our open, Layer-1 blockchain network purpose-built to unite programmable money and onchain innovation with real-world economic activity. As of June 30, 2026, since the launch of Arc testnet in October 2025, Arc testnet has processed 502 million cumulative transactions and 2.8 million cumulative transacting wallets. Private mainnet was launched in May 2026, with 100 + partners as of July 20, 2026, spanning capital markets, digital assets, payments, and technology. Building on this momentum and continued ecosystem engagement, we expect to launch Arc on mainnet in September 2026. Arc is designed as an economic operating system for internet-scale financial infrastructure. It is built to feature predictable, dollar-denominated transaction fees, sub-second finality, opt-in configurable privacy, and native integration with our full-stack platform. Supported by a global ecosystem of partners, Arc is intended to provide an enterprise-grade foundation for stablecoin payments, foreign exchange, lending, and capital markets transactions, and to operate as part of a broader, interoperable multichain ecosystem. 40 Arc is expected to initially operate under a Proof-of-Authority consensus model. Over time, it may transition to a Proof-of-Stake or a delegated Proof-of-Stake consensus mechanism. If such a transition occurs, the network would introduce a native token (the “ARC Token”). The ARC Token is designed as the native coordination asset of the Arc network under the Proof-of-Stake model. If launched, the ARC Token is intended to align participants with the long-term success of the Arc network through staking, governance, and other platform-wide utilities. The ARC Token’s utility is expected to extend beyond the chain itself, spanning numerous protocols and products from us and our ecosystem partners on the Arc network. It is expected to confer governance rights to a distributed participant set responsible for upholding, among other things, the network’s security posture, and infrastructural integrity, establishing the conditions under which institutions can rely on Arc for mission-critical applications and settlement. The total initial supply of ARC Tokens is expected to be 10 billion, though the supply would be subject to increase as a result of the programmatic functioning of the Arc protocol. The timing, structure, terms, and scope of any such transition, or the creation and broader distribution of ARC Tokens, remain subject to ongoing technical, business, legal, regulatory, and market considerations. During the three months ended June 30, 2026, we entered into token purchase agreements with certain institutional investors, pursuant to which we agreed to issue and sell to such purchasers an aggregate of 807.5 million ARC Tokens. The offer and sale of the tokens pursuant to the token purchase agreements was conducted as a private placement exempt from registration under the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and Rule 506(b) of Regulation D promulgated thereunder. Each purchaser has agreed to a lock-up restriction prohibiting the direct or indirect sale, transfer, assignment or other disposition of any ARC Tokens acquired in the presale for a period of not less than one year from the date of the Arc network’s transition to a Proof-of-Stake or a delegated Proof-of-Stake consensus mechanism, and may be subject to additional restrictions on transfer until the date that is four years following such transition date. The ARC Tokens were offered and sold at a purchase price of $0.30 per token, implying a fully diluted network valuation of $3.0 billion and resulting in aggregate gross proceeds to us of approximately $242.2 million. The token purchase agreements and related agreements provide for repayment rights in specified circumstances, including if the ARC Tokens are not delivered or if the Arc network has not completed the transition to a Proof-of-Stake or a delegated Proof-of-Stake consensus mechanism on or before May 8, 2028, or if certain purchaser-specific legal, regulatory, or compliance-related conditions are not satisfied. Please see the section titled “Part II, Item 1A. Risk Factors—Risks Related to Arc and ARC Tokens” of the Quarterly Report on Form 10-Q filed with the SEC on May 11, 2026 for additional discussion about Arc and the ARC Token. Key Factors Affecting Operating Results The growth and success of our business as well as our financial condition and operating results have been, and will continue to be affected by a number of factors, including: Growth of the internet financial system The internet financial system is built on blockchain infrastructure, and represents a fundamental shift that we believe will result in a profound change to the existing financial system by materially improving efficiency, reducing costs, expanding accessibility, and accelerating innovation. While the internet financial system has grown rapidly, it remains in its infancy and is very small relative to the legacy financial system. We believe we are well positioned to be among the winners in this emerging, transformative space, and we expect increased adoption and expansion of the internet financial system to be a key driver of growth in all our products and services, and hence of our overall financial performance. Adoption of stablecoins as the core means of value exchange within the internet financial system We believe stablecoins are the core facilitator of value exchange in the internet financial system. We believe that we are poised to lead the way in driving the growth of stablecoins, with our trusted brand, regulation-first posture, robust scalable infrastructure, institutional-grade safety and soundness, global presence, and strong interoperability. We stand to benefit as the adoption of stablecoins and the internet financial system increase, due not only to the growth in circulation of our stablecoins but also to growth of the platform that we have developed. 41 Expanding global awareness and distribution of our platform Our efforts to expand global awareness and distribution of our digital assets, and to grow our platform, follow a multi-pronged approach that includes: obtaining additional foreign licenses and registrations where necessary; collaboration with key strategic partners; local go-to-market strategies; and further integration with major blockchains. We expect increased awareness and interest in our platform, anchored by our stablecoin network, including both increasing penetration among our existing markets and expansion into new markets, to positively impact our performance. Growth in new products and services We believe we have a sizable opportunity to grow our business through the introduction of new products and services. Arc, our related developer infrastructure, and CPN provide platforms upon which third-party software developers can build and create their own products and financial applications. We continue to develop our products and services, which in turn facilitate the creation of new third-party products for the emerging internet financial system. We expect this will, in turn, increase demand for Circle Digital Assets and serve as a critical driver to the growth of our platform. We anticipate that the products developed on our platform will drive new sources of revenue for us including network service fees, subscription fees, and additional developer services fees. Strategic partnerships We complement our products and services with enterprise-level strategic commercial partnerships, with the goal of driving growth in the distribution and adoption of our platform and Circle Digital Assets. Through these partnerships, we enable companies to offer internet-native financial services to their own customers, to the benefit of our overall network. Many of these partnerships are still in early stages, but we expect that they will contribute meaningfully to our operating and financial performance over time. A few of our strategic partners include Coinbase, who provides a variety of products and services that support the growth and utility of USDC, and Binance, who makes USDC extensively available across its full suite of products and services and adopts USDC as a dollar stablecoin for its corporate treasury. We plan to continue to enter into strategic partnerships like these to expand our product offerings and amplify the network effects of our platform business. In addition, we may enter into such arrangements where we incentivize the use of USDC in exchange for our participation in the digital asset ecosystem. We believe each of these partnerships helps to foster growth of the internet financial system broadly and of our platform and Circle Digital Assets specifically, by reaching new end-users and expanding opportunities for existing end-users. Distribution costs We incur costs to incentivize distributors to use and distribute Circle Digital Assets and these distribution costs have a meaningful impact on our financial performance. For example, our distribution costs payable to key distributors such as Coinbase and Binance are directly impacted by the amount of USDC held on their respective platforms, which is in turn affected by actions and policies that we do not control or oversee. We have added and expect to continue to add additional distributors in the future and anticipate that such distribution contracts may have different commercial terms depending on negotiations with our distributors and the circumstances in our evolving industry. Moreover, our financial performance has been, and we expect it will continue to be, affected by the mix of USDC growth driven by commercial distribution partnerships versus organic growth outside of those arrangements. To the extent USDC adoption increases through channels that do not require third-party incentive payments, our distribution costs may decrease. As we add distributors and approved participants to which incentive payments are paid, our distribution costs may increase in the future. Interest rate fluctuations We derive a substantial majority of our revenue from reserve income. Fluctuations in interest rates impact reserve return rates, which in turn affect our reserve income. However, interest rates are only one contributor to reserve income, and the other primary contributor—USDC in circulation—is inherently difficult to predict given the uncertainties in end-user and customer behavior. For example, although interest rates are positively correlated with the opportunity cost of holding USDC versus other financial instruments, given the utility of USDC as a means for the exchange of value, an increase in interest rates does not necessarily result in a decrease in USDC in circulation (and vice versa). Any relationship between interest rates and USDC in circulation is complex, highly uncertain, and unproven. As a result, while we are able to predict the impact of interest rate changes on the reserve return rate, given uncertainties in end-user and customer behavior and interests and market dynamics, we are unable to accurately predict the impact of such changes on reserve income. 42 Government regulation We have always had a “regulation-first” philosophy that underlies our operations and has led to significant investments in building a robust compliance infrastructure. However, the laws and regulations to which we are subject are rapidly evolving and increasing in scope. As a result, we monitor regulatory changes closely and we expect to continue to invest significant resources in our legal, policy, compliance, product, and engineering teams to ensure our business practices comply with, and plan and prepare for, current and future regulations. National legislation in the US (including the GENIUS Act) and abroad is expected to provide increased certainty for market participants and accelerate institutional adoption. We believe increased global regulatory clarity will result in increased conviction in stablecoins by consumers and enterprises alike, which will drive greater adoption. We believe these trends will naturally increase the growth of our platform and the use and utility of Circle Digital Assets, and set us up to be the leading regulated player in the space. 43 Key Operating Indicators and Financial Results We regularly review several key operating and non-GAAP financial indicators to evaluate our performance and trends and inform management’s budgets, financial projections, and strategic decisions. The following table presents our key operating and financial results, as well as the relevant GAAP measures, for the periods indicated: CCT (dollar amounts are in millions) Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Key operating indicators: USDC in circulation, end of period(1) $ 73,269 $ 61,333 $ 73,269 $ 61,333 USDC in circulation, average of period(1) $ 76,524 $ 61,039 $ 75,865 $ 57,574 Reserve return rate 3.5 % 4.1 % 3.5 % 4.2 % USDC on platform, end of period $ 12,442 $ 6,040 $ 12,442 $ 6,040 USDC on platform, daily weighted-average percentage 19.5 % 7.4 % 18.3 % 6.6 % Key financial results: Total revenue and reserve income $ 701 $ 658 $ 1,395 $ 1,237 Revenue less distribution costs(2) $ 289 $ 251 $ 576 $ 482 RLDC Margin(3) 41 % 38 % 41 % 39 % Net income (loss) from continuing operations $ 48 $ (482) $ 103 $ (417) Net income (loss) from continuing operations margin(4) 7 % (73) % 7 % (34) % Adjusted EBITDA(5) $ 143 $ 126 $ 295 $ 248 Adjusted EBITDA Margin(5) 50 % 50 % 51 % 52 % (1) When calculating USDC in circulation, we exclude: (a) “tokens allowed but not issued,” which are tokens that exist on the Algorand, Hedera, Polkadot, and Solana blockchains due to the technical implementation of USDC on those blockchains. These tokens are held by us in restricted, segregated “tokens allowed but not issued” blockchain addresses. We do not receive any funds for their creation, and they are not redeemable for the U.S. dollar. These tokens are restricted for use while held in such blockchain addresses. These tokens cannot be redeemed for the U.S. dollar as the private keys are securely controlled by us and the blockchain addresses are not configured to allow redemption requests to be established by Circle Mint. When a minting request is received for USDC on these blockchains and the funds underlying such request are received, the corresponding amount of “tokens allowed but not issued” is transferred from the segregated “tokens allowed but not issued” addresses to the minting address via a system controlled process administered by us, at which point the tokens are considered to be USDC in circulation; (b) “access denied tokens,” which are tokens that are restricted from being accessed by the holder to comply with a law, regulation, or legal order from a duly recognized and authorized court of competent jurisdiction, or governmental or other authority with jurisdiction over us. When these tokens were originally issued (i.e., before they were restricted from being accessed), we received the equivalent amount of fiat currency in connection with their original minting. Upon determination that a token should be an “access denied token,” we restrict the access of the holder to such token and transfer the reserves relating to such token to a segregated bank account specifically for “access denied tokens.” The assets in such segregated bank account constitute a component of USDC reserves, and we do not extinguish the associated liability until the segregated reserve funds are transferred to the relevant law enforcement agency or government body or until the access denial request is reversed and a subsequent redemption request is made by the stablecoin holder. As of June 30, 2026 and 2025, there were $123.2 million and $166.6 million of “access denied tokens,” respectively; and (c) “pending burns”, which are USDC balances held within our smart contracts that are pending finalization on the blockchain. We exclude these tokens because they are not used for transactions and thus do not reflect our platform’s breadth, which as noted below, is the principal purpose for which we present USDC in circulation, end of period and USDC in circulation, average of period. We include corporate-held USDC (i.e., USDC held by us), as we routinely use USDC to pay for distribution, transaction, and other costs as well as operating expenses and thus corporate-held USDC contributes to our platform’s breadth. As of June 30, 2026 and 2025, there were $889.3 million and $588.3 million of corporate-held USDC, respectively. (2) Revenue less distribution costs is calculated as Total revenue and reserve income less Total distribution, transaction, and other costs. (3) RLDC Margin is calculated as Total revenue and reserve income less Total distribution, transaction, and other costs as a percentage of Total revenue and reserve income. (4) Net income (loss) from continuing operations margin is calculated as Net income (loss) from continuing operations divided by Total revenue and reserve income. (5) See “Non-GAAP Financial Measures” for reconciliation of GAAP to non-GAAP measures. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total revenue and reserve income less Total distribution, transaction, and other costs. 44 USDC in circulation, end of period and USDC in circulation, average of period USDC in circulation, end of period is the total amount of USDC minted and outstanding as of the end of the reporting period. USDC in circulation, average of period is calculated as the simple daily average of USDC in circulation, with the daily USDC in circulation determined at the end of each day. USDC in circulation, end of period and USDC in circulation, average of period are major contributing factors to our reserve income and also provide a measure of our platform’s breadth. We expect that the continued growth and development of the internet financial system will further drive increases in USDC in circulation, end of period and USDC in circulation, average of period. Reserve return rate Reserve return rate is the rate of return generated on assets held in reserve. Reserve return rate is calculated as our reserve income divided by the average period balance of reserves segregated for the benefit of holders of our stablecoins, with average period balance of reserves segregated for the benefit of holders of our stablecoins measured as the simple daily average of reserves segregated for the benefit of holders of our stablecoins, with daily average of reserves segregated for the benefit of holders of our stablecoins determined at the end of each day. USDC on platform, end of period and USDC on platform, daily weighted-average percentage USDC on platform is defined as the total amount of USDC on our platform, which includes USDC held within Circle Mint accounts, corporate-held USDC, and USDC held within non-custodial wallets offered through our platform (including our managed wallet services such as Circle Wallets and other wallet technologies). USDC on platform provides a measure of our platform’s breadth and is also used to calculate our share of reserve income under the Collaboration Agreement. Daily weighted-average percentage of USDC on platform is defined as the average of the percentage of USDC in circulation that is held on our platform at the end of each day, weighted based on the amount of USDC in circulation at the end of each day. Percentage of USDC on platform at the end of each day is used to calculate our share of reserve income under the Collaboration Agreement. Adjusted EBITDA Adjusted EBITDA, a non-GAAP financial measure, is calculated as net income (loss) from continuing operations excluding: net income (loss) attributable to noncontrolling interests, depreciation and amortization expenses; interest expense, net of amortization of discounts and premiums; interest income; income tax expense (benefit); stock-based compensation expense and payroll tax expense related to stock-based compensation; certain legal expenses; realized and unrealized (gains) losses, net, on digital assets held for investment, other related investments and strategic investments; realized (gains) losses on available-for-sale debt securities; impairment losses on strategic investments; restructuring expenses; acquisition-related costs; change in fair value of convertible debt, warrant liability, embedded derivatives and U.S. Treasury securities; charitable contributions to Circle Foundation; losses on sale of long-lived assets; and foreign currency exchange (gains) losses. Adjusted EBITDA is a key measure used by our management and board of directors to monitor and evaluate the growth and performance of our business operations, facilitate internal comparisons of the historical operating performance of our business operations, facilitate external comparisons of the results of our overall business to the historical operating performance of other companies that may have different capital structures or operating histories, review and assess the performance of our management team and other employees, and prepare budgets and evaluate strategic planning decisions regarding future operating investments. See “—Non-GAAP Financial Measures” below for a reconciliation of Adjusted EBITDA to net income (loss) from continuing operations, the most closely comparable GAAP measure, and additional information about the limitations of our non-GAAP measures. 45 Other Important Platform Metrics In addition to our key operating indicators and financial results, we regularly measure the scale of our platform and the relevance of our products and services to developers and end-users by monitoring and reviewing certain important platform metrics, including: USDC minted, USDC redeemed, stablecoin market share, meaningful wallets. (dollar amounts and meaningful wallets are in millions) Three months ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Important Platform Metrics USDC minted $ 83,004 $ 42,174 $ 156,543 $ 95,396 USDC redeemed $ 86,784 $ 40,817 $ 158,540 $ 77,920 Stablecoin market share, end of period 27 % 28 % 27 % 28 % Meaningful wallets, end of period 7.01 5.66 7.01 5.66 USDC minted / USDC redeemed USDC minted measures the flow of U.S. dollar fiat converted to USDC and USDC redeemed measures the flow of USDC converted to U.S. dollar fiat, in each case, initiated by Circle Mint customers. We believe this demonstrates our operational capacity and resiliency to process minting and redemptions through our digital and banking infrastructure. Stablecoin market share Stablecoin market share is defined as the amount of USDC in circulation as a percentage of the total U.S. dollar fiat-backed stablecoins with circulation above $100 million, according to CoinMarketCap, and that have established periodic public attestations. Stablecoin market share reflects how much of the stablecoin market is composed of USDC relative to the competitive landscape. Meaningful Wallets Meaningful wallets are defined as the number of onchain digital asset wallets with an amount of USDC above $10. As a single end-user may have multiple onchain digital asset wallets, meaningful wallets do not represent, and we do not use meaningful wallets as a measure of, the number of unique end-users with more than $10 of USDC. Nonetheless, we believe that the number of meaningful wallets is an indicator of the breadth of USDC’s adoption and the reach of our stablecoin network. Key Components of Revenue and Expenses Revenue and reserve income Reserve income We earn interest and dividends on assets held in reserve accounts, which include cash balances held at banks and the Circle Reserve Fund, as applicable. Interest income is recognized under the effective interest method, and dividend income is recognized when declared. Reserve income is recorded on a gross basis before the impact of any distribution costs. An increase (or decrease) in the amount of our stablecoins in circulation would increase (or decrease) the amount of assets held in reserve accounts, and thus, assuming a constant reserve return rate, would result in increased (or decreased) reserve income. Other revenue Other revenue consists of revenues generated from products and services that increase the utility of our platform and our Circle Digital Assets. The components of other revenue include subscription and services revenue, transaction revenue, and other revenues. Subscription and services consists of customer agreements where recurring revenue is generated from integration and maintenance services, fund management, time-based access, and user-based licensing. Transaction revenue is generated from usage-based, volume-based, or event-driven transactions. This includes fees associated with the redemption of Circle Digital Assets, blockchain rewards revenue, and use of our platform infrastructure in facilitating digital asset transactions. Other is primarily generated from fees associated with certain non-recurring services and discontinued legacy products. 46 Distribution, transaction, and other costs Distribution costs We incur distribution costs to incentivize distributors to use and distribute our stablecoins, for example, Coinbase, Binance, and others. Under the Collaboration Agreement, Coinbase receives allocations based on the amount of USDC held on its platform after our issuer retention, and Coinbase also receives half of the remaining amount tied to broader ecosystem growth after amounts paid to any approved third-party ecosystem participants pursuant to our Stablecoin Ecosystem Agreement. These deductions are accounted for as components of the overall arrangement with Coinbase as we are not providing a distinct service to issue stablecoins and manage the associated reserves. The Collaboration Agreement is accounted for as an executory contract and reflected in Distribution and transaction costs on our unaudited Condensed Consolidated Statements of Operations. During the three months ended June 30, 2026 and 2025, we incurred $324.6 million and $332.3 million, respectively of distribution costs in connection with our agreements with Coinbase, and during the six months ended June 30, 2026 and 2025, we incurred $655.3 million and $635.5 million respectively, of distribution costs in connection with our agreements with Coinbase. We expect our distribution expense to increase in the future, as we add distributors and approved participants. Our distribution expense will also increase to the extent our reserve income increases over time. We also anticipate new distribution arrangements may differ depending on our negotiations with our distributors and the circumstances in our evolving industry. Transaction costs We incur transaction costs to pay for the blockchain network transaction fees necessary to complete transactions on supported blockchains. For a given blockchain, we purchase the necessary digital assets in advance and, upon initiation of a transaction, we pay blockchain transactions fees using our inventory of digital assets. We expect this expense to increase going forward due to increases in volume and rising fees on certain popular blockchain networks. Other costs Other costs primarily comprise expenses incurred as a result of facilitating and delivering products and services, including certain fees related to the issuance of USYC and other costs to participate in activities that enhance the utility of Circle Digital Assets, Circle Applications and our infrastructure. Other than distribution, transaction, and other costs, we do not incur distinct costs to mint and/or redeem stablecoins. Operating expenses Compensation expenses Compensation expenses are primarily driven by employee compensation, including salaries and wages, stock-based compensation, bonuses, post-retirement benefits, commissions, and severance payments. As we expand our business and team, we expect compensation expenses to increase. General and administrative expenses General and administrative expenses include costs incurred to support our business operations. Specifically, expenses incurred related to insurance policies, dues and subscriptions, legal and professional services, bank fees, rent, travel and business lodging, and contributions and donations. We expect general and administrative expenses to grow as we continue to invest to support the overall growth of our business. Depreciation and amortization expenses Depreciation and amortization expenses are incurred from the amortization of internally developed software, and from the amortization of intangible assets acquired in business combinations and asset acquisitions such as technology platforms, customer relationships, brand names, and licenses. We expect that our depreciation and amortization expenses will increase in future periods as we continue to invest in the development of our various digital platforms. IT infrastructure costs IT infrastructure costs include costs incurred in operating and maintaining our platform, including network, website hosting, and infrastructure costs. IT infrastructure costs also include software and technology costs incurred to support our general business operations including cloud hosting costs, cybersecurity, electronic communications archiving software, change management, and compliance technology such as AML and KYC software, as well as costs related to the use of AI-enabled tools and capabilities. We expect IT infrastructure costs to grow as we continue to support the overall growth of our business. 47 Marketing expenses Marketing expenses are incurred to drive additional customers to our platform, capitalize on cross-sell opportunities from our customer base, and build awareness of our products and brand with the objective of growing our customer base. We expect marketing expenses to grow as we continue to support the overall growth of our business. Digital assets losses (gains) Digital assets are measured at fair value. Fair value measurements for digital assets are based on quoted market prices in active markets. Gains and losses upon sale of digital assets are measured as the difference between the proceeds and the carrying basis of the digital assets as determined on a first-in, first-out (“FIFO”) basis for each pool of digital assets. Other income (expense), net Other income (expense), net, is composed of multiple income (expense) categories, including, but not limited to, the following: •Realized and unrealized gains (losses) on assets and liabilities at fair value (e.g., convertible debt, warrants, U.S. Treasury securities, derivatives, and embedded derivatives); •Realized and unrealized gains (losses) on investments, which include changes in fair value related to our marketable equity securities, digital assets held for investment and observable price changes on our non-marketable equity securities; •Impairment losses on equity investments; •Interest income on corporate cash and cash equivalents balances; •Interest expense, net of accretion of discounts and amortization of premiums; and •Foreign currency exchange gains and losses due to remeasurement of certain foreign currency denominated monetary assets and liabilities. Income tax expense (benefit) Income tax expense (benefit) includes income taxes related to foreign jurisdictions and U.S. Federal and state income taxes. As we conduct business activities internationally, any changes in the U.S. and foreign taxation of such activities may increase our overall provision for income taxes in the future. 48 Results of Operations We discuss our historical results of operations below on a consolidated basis. The following table sets forth a summary of our unaudited Condensed Consolidated Results of Operations for the periods indicated, and the changes between periods. These results of operations have been prepared on the same basis as our unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q. In the opinion of management, the financial information set forth in the table below reflects all normal recurring adjustments necessary for the fair statement of results of operations for these periods. The following unaudited condensed consolidated results of operations should be read together with our unaudited Condensed Consolidated Financial Statements and related notes, included elsewhere in this Form 10-Q. Three Months Ended June 30, 2026 2025 $ Change % Change (in thousands, except percentages) Revenue and reserve income Reserve income $ 667,733 $ 634,274 $ 33,459 5.3 % Other revenue 33,582 23,804 9,778 41.1 % Total revenue and reserve income 701,315 658,078 43,237 6.6 % Distribution, transaction and other costs Distribution and transaction costs 410,414 406,472 3,942 1.0 % Other costs 2,056 470 1,586 337.4 % Total distribution, transaction and other costs 412,470 406,942 5,528 1.4 % Operating expenses Compensation expenses 133,999 503,392 (369,393) (73.4 %) General and administrative expenses 66,273 43,140 23,133 53.6 % Depreciation and amortization expenses 29,896 14,209 15,687 110.4 % IT infrastructure costs 16,359 8,760 7,599 86.7 % Marketing expenses 8,657 7,910 747 9.4 % Digital assets losses (gains) (698) (693) (5) n.m. Total operating expenses 254,486 576,718 (322,232) (55.9 %) Operating income (loss) from continuing operations 34,359 (325,582) 359,941 n.m. Other income (expense), net 17,947 (160,421) 178,368 n.m. Net income (loss) from continuing operations before income taxes 52,306 (486,003) 538,309 n.m. Income tax expense (benefit) 4,092 (3,903) 7,995 204.8 % Net income (loss) from continuing operations 48,214 (482,100) 530,314 n.m. Less: Net loss attributable to noncontrolling interests (7) — (7) n.m. Net income (loss) attributable to common stockholders $ 48,221 $ (482,100) $ 530,321 n.m. n.m.= not meaningful Revenue and reserve income Reserve income. Reserve income increased by $33.5 million, or 5.3%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, of which approximately $147.4 million of the increase is attributable to a 25.2% increase in average daily USDC in circulation reflecting increased demand for Circle stablecoins, as well as expanded strategic partnerships and integrations. This was largely offset by a decrease of approximately $113.9 million attributable to a 66 basis point decline in the average yields reflecting interest rate actions undertaken by the U.S. Federal Reserve. Other revenue. Other revenue increased by $9.8 million, or 41.1%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, due to an $11.1 million increase driven by additional integration services performed, as well as an increase in fund management fees and redemption fees related to our Circle Tokenized Funds and Circle stablecoins, respectively, offset by a $1.5 million decrease in the redemption fees related to our Circle Tokenized Funds. 49 Distribution, transaction and other costs Distribution and transaction costs. Distribution and transaction costs increased by $3.9 million, or 1.0%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, largely driven by an $11.4 million increase in distribution costs due to increased activity with new and existing strategic distribution partnerships. This is largely offset by a $7.7 million decrease in distribution costs paid to Coinbase due to a decrease in Coinbase's share of the total average USDC on-platform balances. Other costs. Other costs increased by $1.6 million, or 337.4%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, largely driven by a $1.4 million increase in incentive costs for USYC issuance resulting from increased activity. Operating Expenses Compensation expenses. Compensation expenses decreased by $369.4 million, or 73.4%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, driven by $423.8 million of stock-based compensation expense recognized during the three months ended June 30, 2025 related to the vesting of RSUs, for which the service-based condition had been met prior to the IPO, and the liquidity-event related performance condition was met upon the completion of the IPO and upon the commencement of trading of our Class A common stock on the NYSE during the three months ended June 30, 2025. Excluding the above impact, there was an increase of $42.5 million in stock-based compensation expense and an increase of $9.8 million in salaries, wages and bonus expenses, both of which were due to an increase in average headcount. General and administrative expenses. General and administrative expenses increased by $23.1 million, or 53.6%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, largely driven by a $12.8 million increase in legal, professional and consulting fees, a $2.8 million increase in travel and entertainment costs due to Company events and associated travel expenses, a $2.2 million increase in contributions and donations, and a $1.8 million increase in audit and related fees. Depreciation and amortization expenses. Depreciation and amortization expenses increased by $15.7 million, or 110.4%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, due to a $13.4 million and $1.9 million increase in amortization expense of internally developed software and acquired intangible assets, respectively. IT infrastructure costs. IT infrastructure costs increased by $7.6 million, or 86.7%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, due to a $4.5 million increase in software support and license costs to facilitate infrastructure build-out and enhanced product offerings and a $3.1 million increase in costs related to use of AI-enabled tools and capabilities. Marketing expenses. Marketing expenses increased by $0.7 million, or 9.4%, for the three months ended June 30, 2026, compared to three months ended June 30, 2025, driven by a $0.9 million increase in spending on marketing, advertising and sponsorship campaigns, offset by a decrease of $0.2 million in conference expenses. Digital assets losses (gains). Digital assets losses (gains) remained flat for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. Other income (expense), net. Other income (expense), net changed by $178.4 million, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, due to the non-recurrence of prior-year fair value losses of $168.5 million related to the convertible notes that converted into Class A common stock in the first quarter of 2026. In addition, there was a $9.5 million increase in income from favorable foreign currency exchange rate movements and a $4.6 million increase in interest income received on corporate cash and cash equivalents balances. Income tax expense (benefit). Income tax expense (benefit) increased by $8.0 million, or 204.8%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The increase primarily reflects significant incremental U.S. tax benefits recognized in the prior-year quarter from IPO-related stock-based compensation deductions, which partially offset previously accrued U.S. income tax expense. 50 Six Months Ended June 30, 2026 2025 $ Change % Change (in thousands, except percentages) Revenue and reserve income Reserve income $ 1,320,241 $ 1,192,185 $ 128,056 10.7 % Other revenue 75,207 44,466 30,741 69.1 % Total revenue and reserve income 1,395,448 1,236,651 158,797 12.8 % Distribution, transaction and other costs Distribution and transaction costs 815,816 753,784 62,032 8.2 % Other costs 3,435 805 2,630 326.7 % Total distribution, transaction and other costs 819,251 754,589 64,662 8.6 % Operating expenses Compensation expenses 272,126 579,012 (306,886) (53.0 %) General and administrative expenses 123,534 73,824 49,710 67.3 % Depreciation and amortization expenses 56,663 28,089 28,574 101.7 % IT infrastructure costs 29,081 16,432 12,649 77.0 % Marketing expenses 15,274 11,770 3,504 29.8 % Digital assets losses (gains) 158 5,577 (5,419) (97.2 %) Total operating expenses 496,836 714,704 (217,868) (30.5 %) Operating income (loss) from continuing operations 79,361 (232,642) 312,003 n.m. Other income (expense), net 29,630 (163,524) 193,154 n.m. Net income (loss) from continuing operations before income taxes 108,991 (396,166) 505,157 n.m. Income tax expense (benefit) 5,531 21,143 (15,612) (73.8 %) Net income (loss) from continuing operations 103,460 (417,309) 520,769 n.m. Less: Net loss attributable to noncontrolling interests (14) — — (14) n.m. Net income (loss) attributable to common stockholders $ 103,474 $ (417,309) $ 520,783 n.m. n.m.= not meaningful Revenue and reserve income Reserve income. Reserve income increased by $128.1 million, or 10.7%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, of which approximately $348.0 million of the increase is attributable to a 31.7% increase in average daily USDC in circulation reflecting increased demand for Circle stablecoins, as well as expanded strategic partnerships and integrations. This was largely offset by a decrease of approximately $220.0 million which was attributable to a 66 basis point decline in the average yields reflecting interest rate actions undertaken by the U.S. Federal Reserve. Other revenue. Other revenue increased by $30.7 million, or 69.1%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, due to a $31.4 million increase driven by additional integration services performed, blockchain rewards revenue, and higher fund management fees and redemption fees related to our Circle Tokenized Funds and Circle stablecoins, respectively, offset by a $1.4 million decrease in the redemption fees related to our Circle Tokenized Funds. Distribution, transaction and other costs Distribution and transaction costs. Distribution and transaction costs increased by $62.0 million, or 8.2%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, driven by a $42.0 million increase in distribution costs due to increased activity with new and existing strategic distribution partnerships and a $19.8 million increase in distribution costs paid to Coinbase due to increased reserve income partially offset by a decrease in Coinbase's share of the total average USDC on-platform balances. Other costs. Other costs increased by $2.6 million, or 326.7%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, largely driven by a $2.2 million increase in incentive costs for USYC issuance resulting from increased activity. 51 Operating Expenses Compensation expenses. Compensation expenses decreased by $306.9 million, or 53.0%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, driven by $423.8 million of stock-based compensation expense recognized during the six months ended June 30, 2025 related to the vesting of RSUs, for which the service-based condition had been met prior to the IPO, and the liquidity-event related performance condition was met upon the completion of the IPO and upon the commencement of trading of our Class A common stock on the NYSE during the six months ended June 30, 2025. Excluding the above impact, there was an increase of $81.6 million in stock-based compensation expense and a $20.5 million increase in salaries, wages and bonus expenses, both of which were due to an increase in average headcount. Additionally, there was an $11.8 million increase in payroll taxes primarily related to the vesting of equity awards. General and administrative expenses. General and administrative expenses increased by $49.7 million, or 67.3%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, largely driven by a $24.7 million increase in legal, professional and consulting fees, an $8.0 million increase in contributions and donations, a $7.1 million increase in travel and entertainment costs due to Company events and associated travel expenses, and a $2.7 million increase in business insurance costs. Depreciation and amortization expenses. Depreciation and amortization expenses increased by $28.6 million, or 101.7%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, due to a $24.9 million and $2.6 million increase in amortization expense of internally developed software and acquired intangible assets, respectively. IT infrastructure costs. IT infrastructure costs increased $12.6 million, or 77.0%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, due to an $8.6 million increase in software support and license costs to facilitate infrastructure build-out and enhanced product offerings, and a $4.1 million increase in costs related to use of AI-enabled tools and capabilities. Marketing expenses. Marketing expenses increased by $3.5 million, or 29.8%, for the six months ended June 30, 2026, compared to six months ended June 30, 2025, driven by a $2.4 million increase in spending on marketing, advertising and sponsorship campaigns, and a $1.1 million increase in conference expenses. Digital assets losses (gains). Digital assets losses (gains) changed by $5.4 million, or 97.2% for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, largely due to $4.5 million in losses recognized during the six months ended June 30, 2025 related to the deprecation of certain legacy products. Other income (expense), net. Other income (expense), net changed by $193.2 million, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, due to the non-recurrence of prior-year fair value losses of $162.0 million related to the convertible notes that converted into Class A common stock in the first quarter of 2026. In addition, there was a $15.2 million increase in income from favorable foreign currency exchange rate movements, a $10.3 million increase in interest income received on corporate cash and cash equivalents balances, and a $7.5 million increase from favorable changes in unrealized gains and losses on investments. Income tax expense (benefit). Income tax expense (benefit) decreased by $15.6 million, or 73.8% for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The decrease was primarily attributable to lower U.S. income tax expense, as federal and state net operating loss carryforwards and stock-based compensation deductions reduced U.S. taxable income in 2026. The decrease was partially offset by IPO-related stock-based compensation tax benefits recognized in the prior-year period. 52 Changes in Financial Position The following table sets forth a summary of selected line items from our unaudited Condensed Consolidated Balance Sheets for the periods indicated, and the changes between periods. These selected line items have been prepared on the same basis as our unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q. In the opinion of management, the financial information set forth in the table below reflects all normal recurring adjustments necessary for the fair statement of changes in the selected line items for these periods. The following selected line items should be read together with our unaudited Condensed Consolidated Financial Statements and related notes, included elsewhere in this Form 10-Q. (in thousands, except percentage information) June 30, 2026 December 31, 2025 $ Change % Change ASSETS Current assets: Cash and cash equivalents (including cash and cash equivalents segregated for corporate-held stablecoins) $ 2,619,437 $ 2,349,009 $ 270,428 11.5 % Cash and cash equivalents segregated for the benefit of stablecoin holders 73,161,172 75,067,932 (1,906,760) (2.5 %) Accounts receivable, net 105,431 62,866 42,565 67.7 % Prepaid expenses and other current assets 283,578 321,660 (38,082) (11.8 %) Non-current assets: Investments 103,757 84,265 19,492 23.1 % Fixed assets, net 22,177 22,791 (614) (2.7 %) Digital assets 106,539 86,515 20,024 23.1 % Intangible assets, net 446,577 411,146 35,431 8.6 % Deferred tax assets, net 11,354 11,110 244 2.2 % Other non-current assets 26,890 27,379 (489) (1.8 %) LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Deposits from stablecoin holders $ 72,927,544 $ 74,912,567 $ (1,985,023) (2.6 %) Accounts payable and accrued expenses 418,588 360,609 57,979 16.1 % Convertible debt, net of debt discount — 36,821 (36,821) (100.0 %) Other current liabilities 256,021 18,398 237,623 n.m. Non-current liabilities: Deferred tax liabilities, net 28,495 28,702 (207) (0.7 %) Other non-current liabilities 24,837 25,337 (500) (2.0 %) Stockholders’ equity: Additional paid-in capital 4,693,986 4,610,216 83,770 1.8 % Accumulated deficit (1,189,235) (1,292,709) 103,474 8.0 % Total stockholders’ equity 3,509,975 3,330,773 179,202 5.4 % n.m.= not meaningful In accordance with applicable regulatory requirements and commercial law, for stablecoins issued and outstanding, we are generally required to hold at least an equivalent amount of fiat currency denominated assets, held in accounts that are titled FBO holders of Circle stablecoins. We may hold reserve assets segregated for the benefit of holders of Circle stablecoins in excess of deposits from holders of Circle stablecoins due to funds related to reserve income received that has not yet been transferred to corporate cash due to the timing of receipt and unprocessed customer deposits that have not yet been minted. We have access to and are entitled to the excess over redemption and customer obligations. We are not required by law or internal policy to maintain any such excess. Current assets Cash and cash equivalents (including cash and cash equivalents segregated for corporate-held stablecoins). Cash and cash equivalents (including cash and cash equivalents segregated for corporate-held stablecoins) increased by $270.4 million, or 11.5%, as of June 30, 2026, compared to December 31, 2025. Refer to “— Liquidity and Capital Resources — Cash Flows” below for further discussion on the net cash flows from operating activities, investing activities and financing activities during the period. 53 Cash and cash equivalents segregated for the benefit of stablecoin holders. Cash and cash equivalents segregated for the benefit of stablecoin holders decreased by $1.9 billion, or 2.5%, as of June 30, 2026, compared to December 31, 2025, due to a $2.0 billion decrease in USDC in circulation. Refer to “— Liquidity and Capital Resources — Composition of USDC reserves” below for further discussion of the composition of the reserves. Accounts receivable, net. Accounts receivable, net increased by $42.6 million, or 67.7%, as of June 30, 2026, compared to December 31, 2025, driven by a $28.0 million increase in accounts receivables related to integration services for new blockchain launches and maintenance and support fees and a $20.2 million increase from the ARC Token presale, offset by a $5.8 million increase in provision for expected credit losses and a decrease due to unfavorable changes in the fair value of certain embedded derivatives associated with digital assets receivable for integration services. Prepaid expenses and other current assets. Prepaid expenses and other current assets decreased by $38.1 million, or 11.8%, as of June 30, 2026, compared to December 31, 2025, driven by a $25.6 million decrease in reserve income receivables due to lower average interest rates and reduced average holdings, and a $13.2 million decrease in income tax receivables. Non-current assets Investments. Investments increased by $19.5 million, or 23.1%, as of June 30, 2026 compared to December 31, 2025, due to a $12.4 million increase in new strategic investments and a $6.5 million increase due to net unrealized gains on certain investments. Digital assets. Digital assets increased by $20.0 million, or 23.1%, as of June 30, 2026 compared to December 31, 2025, due to a $19.3 million increase in purchases of digital assets, a $5.4 million increase in blockchain rewards revenue, and a $4.0 million increase in digital assets received for services, offset by an $8.8 million decrease due to mark-to-market fluctuations in prices of digital assets. Intangible assets, net. Intangible assets, net increased $35.4 million, or 8.6%, as of June 30, 2026 compared to December 31, 2025, due to a $20.0 million increase in acquired patents, a $10.5 million increase in capitalization of internally developed software, net of amortization, and a $7.9 million increase in acquired intangible assets, net of amortization, related to an asset acquisition that closed in January 2026. Current liabilities Deposits from stablecoin holders. Deposits from stablecoin holders decreased by $2.0 billion, or 2.6%, as of June 30, 2026, compared to December 31, 2025. Refer to the “Cash and cash equivalents segregated for the benefit of stablecoin holders” narrative above for further discussion. Accounts payable and accrued expenses. Accounts payable and accrued expenses increased by $58.0 million, or 16.1%, as of June 30, 2026, compared to December 31, 2025, due to a $68.4 million increase in stablecoin redemption liabilities, a $20.0 million increase related to an acquisition of patents, offset by a $29.5 million decrease in accrued compensation expenses primarily driven by payments of the year-end accrued bonus and payroll taxes in the first quarter of 2026. Convertible debt, net of debt discount. Convertible debt, net of debt discount decreased by $36.8 million, or 100.0%, as of June 30, 2026, compared to December 31, 2025, due to the conversion of the outstanding convertible notes into Class A common stock in the first quarter of 2026. Other current liabilities. Other current liabilities increased by $237.6 million, as of June 30, 2026, compared to December 31, 2025, due to a $242.2 million increase in deferred revenue related to the ARC Token presale during the second quarter of 2026. Stockholders’ equity Stockholders’ equity. Stockholders' equity increased by $179.2 million, or 5.4%, as of June 30, 2026, compared to December 31, 2025, largely due to a $128.6 million increase in stock-based compensation, $103.5 million of net income attributable to common stockholders recognized during the six months ended June 30, 2026, a $41.6 million increase resulting from the issuance of common stock upon the exercise of stock options, and a $39.4 million increase due to the conversion of the outstanding convertible notes into Class A common stock. This increase is offset by a $149.8 million decrease related to the issuance of common stock upon the settlement of RSUs, net of shares withheld. 54 Non-GAAP Financial Measures Adjusted EBITDA To provide investors with additional information regarding our financial results, we have disclosed here and elsewhere in this Form 10-Q Adjusted EBITDA, a non-GAAP financial measure that we calculate as net income (loss) from continuing operations excluding: net income (loss) attributable to noncontrolling interests; depreciation and amortization expenses; interest expense, net of amortization of discounts and premiums; interest income; income tax expense (benefit); stock-based compensation expense and payroll tax expense related to stock-based compensation; certain legal expenses; realized and unrealized (gains) losses, net, on digital assets held for investment, other related investments and strategic investments; realized (gains) losses on available-for-sale debt securities; impairment losses on strategic investments; restructuring expenses; acquisition-related costs; change in fair value of convertible debt, warrant liability, embedded derivatives and U.S. Treasury securities; charitable contributions to Circle Foundation; losses on sale of long-lived assets and foreign currency exchange (gains) losses. We have provided a reconciliation below of Adjusted EBITDA to net income (loss) from continuing operations, the most directly comparable GAAP financial measure. Beginning in the first quarter of 2026, we have amended the above definition of Adjusted EBITDA to exclude payroll tax expense related to stock-based compensation, because these taxes are directly related to stock-based compensation expense which is already excluded from Adjusted EBITDA. These expenses represent employer payroll taxes related to the vesting and settlement of certain equity awards, and are variable with our stock price and other factors outside of our control. The change had no effect on the prior periods presented. We present Adjusted EBITDA because it is a key measure used by our management and board of directors to monitor and evaluate the growth and performance of our business operations, facilitate internal comparisons of the historical operating performance of our business operations, facilitate external comparisons of the results of our overall business to the historical operating performance of other companies that may have different capital structures or operating histories, review and assess the performance of our management team and other employees, and prepare budgets and evaluate strategic planning decisions regarding future operating investments. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. We believe it is useful to exclude non-cash charges, such as depreciation and amortization, stock-based compensation expense, and change in fair value of various financial instruments as well as certain cash charges such as payroll tax related to stock-based compensation from Adjusted EBITDA because the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations. We believe it is useful to exclude income tax expense (benefit), interest income, interest expense, and non-routine items as these items are not components of our core business operations. Adjusted EBITDA has limitations as a financial measure and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are: •Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect capital expenditure requirements for such replacements or for new capital expenditures; •Adjusted EBITDA does not reflect stock-based compensation and payroll tax expense related to stock-based compensation. Stock-based compensation expense and the related payroll tax expense has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation strategy; •Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital; •Adjusted EBITDA excludes one-time non-routine items; and •Other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure. Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash flow metrics, net income (loss), and our other GAAP results. 55 The following table reconciles Adjusted EBITDA to net income (loss) from continuing operations, the most closely comparable GAAP financial measure, for the periods indicated (in thousands): Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net income (loss) from continuing operations $ 48,214 $ (482,100) $ 103,460 $ (417,309) Less: Net loss attributable to noncontrolling interests (7) — (14) — Net income (loss) attributable to common stockholders $ 48,221 $ (482,100) $ 103,474 $ (417,309) Adjusted for: Depreciation and amortization expenses 29,896 14,209 56,663 28,089 Interest expense, net of amortization of discounts and premiums 64 344 102 679 Interest income (1) (14,517) (9,952) (28,226) (17,917) Income tax expense (benefit) 4,092 (3,903) 5,531 21,143 Stock-based compensation expense and related payroll taxes(2) 61,236 434,966 123,660 447,682 Legal expenses(3) 10,341 1,706 17,360 3,611 Realized and unrealized (gains) losses, net, on digital assets held for investment, other related investments and strategic investments (3,702) (5,738) (377) 2,524 Impairment losses on strategic investments 115 506 366 506 Acquisition-related costs(4) 1,920 — 3,790 535 Change in fair value of convertible debt, warrant liability, embedded derivatives and U.S. Treasury securities 1,876 167,724 5,984 170,106 Charitable contributions to Circle Foundation(5) 5,411 — 13,148 — Losses on sale of long-lived assets — 4 — 16 Foreign currency exchange (gains) losses (1,475) 8,067 (6,596) 8,605 Adjusted EBITDA $ 143,478 $ 125,833 $ 294,879 $ 248,270 (1)Reflects interest income from corporate cash and cash and cash equivalents balances. For the avoidance of doubt, this amount does not include the impact of reserve income. (2)Beginning in the first quarter of 2026, we have amended the definition of Adjusted EBITDA to exclude payroll tax expense related to stock-based compensation. We did not retrospectively apply this change to prior periods. For the three months ended June 30, 2026 and 2025, the payroll tax expense related to stock-based compensation was $7.6 million and $7.2 million, respectively. For the six months ended June 30, 2026 and 2025, the payroll tax expense related to stock-based compensation was $18.2 million and $7.2 million, respectively. (3)Reflects litigation expenses related to the FT Partners litigation, legal and settlement expenses related to legacy businesses, and legal fees and other costs related to one-time regulatory matters. Refer to Note 22 to our unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q for a summary of certain of these legal matters. (4)Reflects special one-time compensation related to an asset acquisition that closed in January 2026, and one-time legal and professional services costs related to the Hashnote acquisition in January 2025, for the three and six months ended June 30, 2026 and 2025, respectively. (5)Reflects the charge related to the charitable contribution of shares of our Class A common stock for the benefit of Circle Foundation, a donor-advised fund. Refer to Note 15 to our unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q for further details on donations to Circle Foundation. 56 Liquidity and Capital Resources We measure liquidity in terms of our ability to fund the cash requirements of our business operations, including our working capital and capital expenditure needs and other commitments. Our recurring working capital requirements relate mainly to our cash operating costs. Our capital expenditure requirements consist mainly of software development related to our product development and are primarily dependent on the expansion of our products as well as salaries and wages of employees associated with software development projects. As of June 30, 2026, we had total liquidity sources of $2.6 billion, which consisted of $1.7 billion in Cash and cash equivalents and $889.3 million in Cash and cash equivalents segregated for corporate-held stablecoins on the unaudited Condensed Consolidated Balance Sheets. We believe our operating cash flows, together with our total liquidity sources on hand, will be sufficient to meet our working capital and capital expenditure requirements for a period of at least 12 months from the date of this Form 10-Q. We expect our capital expenditures and working capital requirements to continue to increase in the immediate future as we continue to invest in the expansion of our products and services. Operating payments made in the form of corporate-held stablecoins are utilized and presented on the unaudited Condensed Consolidated Statements of Cash Flows in the same manner as if such payments were settled in cash. Refer to Note 2 Deposits from Stablecoin Holders on the unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q for additional details regarding the accounting for the use of corporate-held stablecoins on our unaudited Condensed Consolidated Statements of Cash Flows. Cash and cash equivalents segregated for the benefit of stablecoin holders was $73.2 billion and $75.1 billion as of June 30, 2026 and December 31, 2025, respectively. This represents cash and cash equivalents maintained in segregated reserve accounts. We segregate the use of the assets underlying the customer funds to meet regulatory requirements and classify the assets as current based on their purpose and availability to fulfill our direct obligation under custodial funds due to stablecoin holders. Off-Balance Sheet Arrangements As of June 30, 2026 and December 31, 2025, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Composition of USDC Reserves The table presented below summarizes the composition of the reserves backing USDC in circulation (which, as discussed in “Key operating indicators and financial results”, excludes access denied tokens and tokens allowed but not issued (for which we do not receive fiat funds)), the outstanding balance, and the average yield for the periods indicated. We use USDC in circulation in the table presented below to align with our presentation in “—Key operating indicators and financial results” and because reserves backing access denied tokens do not represent a material portion of USDC reserves. The amounts below differ from assets (cash and cash equivalents) segregated for the benefit of stablecoin holders, as these line items on our balance sheet include reserve assets backing access denied tokens and reserve assets backing EURC (which is held only in cash at banks and not material for the periods presented) and excludes the amount of reserve assets backing corporate-held USDC. In addition, the amounts differ due to timing and settlement differences, such as reserve income earned but not yet transferred to corporate cash and timing differences of cash receipts and payments related to the minting and redemption process. (in millions, except percentages) June 30, 2026 Three Months Ended June 30, 2026 Six Months Ended June 30, 2026 June 30, 2025 Three Months Ended June 30, 2025 Six Months Ended June 30, 2025 Asset Class Fair Value Average Yield Average Yield Fair Value Average Yield Average Yield Cash $ 11,428 2.98 % 2.97 % $ 8,233 3.45 % 3.45 % Circle Reserve Fund $ 61,917 3.57 % 3.58 % $ 53,165 4.24 % 4.25 % As of June 30, 2026 and 2025, USDC reserves held as cash balances at banks (labeled as “Cash” in the table above) significantly exceeded the FDIC insurance limit of $250,000 per financial institution. As of June 30, 2026 and 2025, FDIC deposit insurance related to financial institutions where USDC reserves were held was limited to an aggregate amount of $1.8 million (representing seven FDIC-insured financial institutions) and $1.3 million (representing five FDIC-insured financial institutions), respectively. The liabilities related to Deposits from stablecoin holders on the unaudited Condensed Consolidated Balance Sheets are not covered by FDIC deposit insurance. 57 As of June 30, 2026, approximately 84% of USDC reserves are held in the Circle Reserve Fund. The remaining amount is held in cash distributed across multiple banks. We allocate USDC reserves across the different types of reserve assets in accordance with our reserve management standard in a manner designed to ensure available liquidity to meet redemption requests. The Circle Reserve Fund is a government money market fund pursuant to Rule 2a-7 under the 1940 Act, holding a portfolio of U.S. Treasury securities with remaining maturities of three months or less, overnight U.S. Treasury repurchase agreements, and cash. As an SEC-registered Rule 2a-7 fund, the securities purchased by the Circle Reserve Fund are subject to the quality, diversification, and other requirements of Rule 2a-7 under the 1940 Act and other rules of the SEC. The Circle Reserve Fund is managed by BlackRock. The Circle Reserve Fund is only available to us, the only shareholder of the Circle Reserve Fund, and we have consent rights over changes to certain fundamental investment restrictions, such as the Circle Reserve Fund acting in ways that are not permitted under the 1940 Act or inconsistent with the disclosure in the fund’s prospectus. The Circle Reserve Fund seeks to maintain a net asset value (“NAV”) of $1 per share. Our investment in the Circle Reserve Fund is not insured or guaranteed by the FDIC or any other government agency. BlackRock is not required to reimburse the fund for losses and is not required to provide financial support for the fund at any time. If the terms of the Circle Reserve Fund are modified to no longer suit our objectives, or if BlackRock manages the Circle Reserve Fund in a manner inconsistent with our reserve management standard, we may redeem our shares of the Circle Reserve Fund; we do not have other recourse (other than under the securities laws if BlackRock manages the Circle Reserve Fund in a manner inconsistent with the fund’s prospectus). Our determination of whether to invest and the amount of investment in the Circle Reserve Fund is governed by our reserve management standard. The Circle Reserve Fund has a $2 billion minimum investment requirement. However, we are not obligated to invest in the Circle Reserve Fund. Information regarding the Circle Reserve Fund is available, and is updated daily, on BlackRock’s website under the USDXX ticker symbol (CUSIP: 09261A870), including the fund’s net asset value, assets held within the fund, the fund’s yield, and the yields of specific assets held within the fund. The composition of assets held within the fund will vary over time, and the assets within the fund could have different remaining maturities (but always three months or less) and provide different yields. Sources of liquidity Initial Public Offering (IPO) In June 2025, we completed our IPO, in which we issued and sold 19.9 million shares of our Class A common stock, including the underwriters’ over-allotment option which was exercised in full, at a public offering price of $31.00 per share. The IPO resulted in net proceeds to us of $583.0 million after deducting the underwriting discounts and commissions and before deducting offering costs of $12.8 million, which were charged to additional paid-in capital as a reduction of the net proceeds received from the IPO. Follow-on Public Offering In August 2025, we completed a follow-on public offering of our Class A common stock, in which we issued and sold 3.5 million shares of our Class A common stock, including the underwriters’ over-allotment option which was exercised in full, at a public offering price of $130.00 per share. This resulted in net proceeds to us of $444.8 million after deducting the underwriting discounts and commissions and before deducting offering costs of $1.8 million, which were charged to additional paid-in capital as a reduction of the net proceeds received from the follow-on public offering. Warrants In April 2023, Circle entered into an agreement with a commercial counterparty to grant warrants to purchase up to 4.5 million common shares of a consolidated subsidiary that will be automatically converted one-for-one into shares of Class A common stock upon exercise. The warrants have an exercise price of $42.14 per share and an exercise period of ten years from the grant date. The warrants are subject to certain service conditions to be achieved over a two-year period and performance conditions to be achieved over a five-year period. As of June 30, 2026, 3.4 million of these warrants have expired. The vesting conditions for the remaining warrants have not been met, and none of the common shares associated with these warrants have been exercised or forfeited. In August 2023, Circle entered into an agreement with a digital asset exchange to grant warrants to purchase up to 3.6 million common shares of a consolidated subsidiary that will be automatically converted one-for-one into shares of Class A common stock upon exercise. The warrants have an exercise price of $25.09 per share and an exercise period of five years from the grant date. The warrants are subject to a performance condition. This condition has not been met, and none of the common shares associated with these warrants have been exercised or forfeited or have expired. 58 In December 2024, Circle entered into an agreement with a commercial counterparty to grant warrants to purchase up to approximately 2.9 million shares of Class A common stock. The warrants have an exercise price of $22.71 per share and an exercise period of six years from the grant date. The vesting of the warrants is subject to certain conditions to be achieved over a three-year period. As of June 30, 2026, 1.0 million of these warrants have vested, and the counterparty elected to exercise 0.3 million and 1.0 million of the warrants during the three and six months ended June 30, 2026, respectively, resulting in the net issuance of approximately 0.2 million and 0.7 million shares of Class A common stock during the three and six months ended June 30, 2026, respectively. None of the common shares associated with these warrants have been forfeited or expired. Other commitments and contingencies Our commitments for facilities' leases under non-cancelable operating leases amounted to $24.5 million as of June 30, 2026. As of the date of this Form 10-Q, we did not have any other material commitments for cash expenditures. We are involved in claims, lawsuits, government investigations, and proceedings arising from the ordinary course of our business. We record a contingent liability when we believe that it is both probable that a liability has been incurred, and that the amount can be reasonably estimated. Refer to Note 22 to our unaudited Condensed Consolidated Financial Statements included elsewhere in this Form 10-Q for a summary of our contingent liabilities. Significant judgment is required to determine both probability and the estimated amount. Such legal proceedings are inherently unpredictable and subject to significant uncertainties, some of which are beyond our control. Should any of these estimates and assumptions change or prove to be incorrect, it could have a material impact on our results of operations, financial position, and cash flows. If we determine there is a reasonable possibility that we may incur a loss and the loss or range of loss can be estimated, we disclose the possible loss in the accompanying notes to the unaudited Condensed Consolidated Financial Statements to the extent material. Cash flows The following table summarizes our cash flows for the periods indicated: (in millions) Six months ended June 30, 2026 2025 Net cash provided by operating activities $ 539 $ 304 Net cash used in investing activities (57) (46) Net cash (used in) provided by financing activities (2,115) 17,797 Operating Activities Net cash provided by operating activities was $538.5 million and $303.7 million for the six months ended June 30, 2026 and 2025, respectively, resulting in an increase of $234.8 million. The increase in net cash provided by operating activities was primarily driven by favorable changes in net working capital for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 of $193.7 million, which was driven by $222.0 million in proceeds received from the sale of our ARC tokens during the second quarter of 2026. Additionally, net income after adjusting for non-cash items increased by $41.1 million. The increase was primarily driven by higher revenues less distribution costs, partially offset by an increase in cash-based operating expenses. Investing Activities Net cash used in investing activities was $57.2 million for the six months ended June 30, 2026, primarily driven by $35.8 million in capitalization of software development costs, $11.7 million in purchases of strategic investments, and $10.4 million in purchases of long-lived assets. Net cash used in investing activities was $46.1 million for the six months ended June 30, 2025, primarily driven by $24.9 million in capitalization of software development costs, $7.7 million in net cash consideration related to the Hashnote acquisition, $7.4 million in purchases of long-lived assets and $6.4 million in purchases of strategic investments. 59 Financing Activities Net cash used in financing activities was $2.1 billion for the six months ended June 30, 2026, reflecting a $2.0 billion decrease in net changes in deposits held for stablecoin holders primarily due to a decrease in USDC in circulation, and a decrease from $149.5 million of payments of withholding taxes on settlement of restricted stock units. Net cash provided by financing activities was $17.8 billion for the six months ended June 30, 2025, reflecting a $17.3 billion increase in net changes in deposits held for stablecoin holders primarily due to an increase in USDC in circulation, and $572.6 million in proceeds received from the issuance of common stock in connection with the IPO, net of underwriting discounts and commissions and offering costs. Critical Accounting Estimates Our discussion and analysis of our financial condition and results of operations are based upon our unaudited Condensed Consolidated Financial Statements, which have been prepared in accordance with U.S. GAAP. In preparing our unaudited Condensed Consolidated Financial Statements, we make estimates and judgments that affect the reported amounts of assets, liabilities, stockholders’ equity, revenue, expenses, and related disclosures. We re-evaluate our estimates on an on-going basis. Our estimates are based on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Because of the uncertainty inherent in these matters, actual results may differ from these estimates and could differ based upon other assumptions or conditions. There have been no material changes to our critical accounting estimates as compared to the critical accounting estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. Refer to Note 2 to the unaudited Condensed Consolidated Financial Statements included in this Form 10-Q for updates to disclosures of accounting standards required to be adopted in the future. 60