Circle cuts about 5% of staff in a quarter with $226 million profit

Circle, the company behind the USDC stablecoin, has cut about 5% of its workforce. It disclosed the cuts in a footnote to its third-quarter results on 4 November, in the same release that reported $226 million in net income from continuing operations, up 5% from a year earlier. Decrypt spotted the footnote.

Circle wrote that it designed the reduction “to better align our organizational structure with our operating model and strategic priorities”, Decrypt reports. The company did not say how many people lost their jobs or which teams. The release puts a price on the cuts:

• $9.1 million in restructuring costs, mostly notice-period pay and severance;
• a $5.7 million reversal of stock-based pay, because departing staff forfeited unvested shares;
• full-year adjusted operating expense guidance unchanged at $570 million to $585 million.

Revenue up, interest income down

Total revenue and reserve income rose 17% to $865 million, and adjusted EBITDA rose 85% to $317 million, according to the earnings release. Reserve income, the interest Circle earns on the cash and Treasuries behind USDC, fell 8% to $658 million as rates dropped.

Other revenue filled the gap. It reached $207 million, and $182 million of that came from the presale of ARC, the token of Circle’s Arc blockchain. A presale brings in money once, so this line may shrink in the fourth quarter.

Average USDC in circulation rose 8% to $73.3 billion, and supply ended the quarter at $73.9 billion. Circle put its share of the dollar stablecoin market at 27%.

Allaire left the cuts out

Chief executive Jeremy Allaire wrote on X that “Q3 was a big quarter for Circle” and listed USDC’s gains in transaction volume: 79% of stablecoin transaction volume, up from 66% a year earlier. He did not mention the Circle job cuts. He added that “In January, the GENIUS Act takes effect and regulated digital dollars go mainstream.”

Circle joins other crypto firms that cut staff this year. Decrypt counts these:

• Coinbase, 14% in May;
• the Ethereum Foundation, 20% in June;
• BitGo, 15% in June;
• Luno, a fifth of its staff in July;
• Bitwise, 14% in August.

What it means for you

If you hold USDC, Circle keeps the reserves in cash and a BlackRock-managed fund, apart from the money it spends on staff. If you own Circle shares, the quarter shows how much the company still depends on interest rates. When the Fed cuts, reserve income falls, and this quarter Circle answered with cost cuts.

Financial figures come from Circle’s third-quarter release. Circle has not disclosed the number of employees affected.