NEW YORK, Feb 27, 2026, 08:13 ET — Premarket
- Circle shares pulled back in premarket trading, giving up some ground after their strong, earnings-fueled surge.
- The direction of USDC and where U.S. rates head next are shaping the conversation.
- March 6 brings the next macro hurdle for rate-sensitive names: the U.S. jobs report.
Circle Internet Group (CRCL.N) slipped 2.9% to $84.70 before the bell Friday, pulling back after a 4.9% jump to $87.21 in the previous session.
Investors are working through Circle’s latest quarterly results, which topped forecasts and shed light on demand for USDC, the company’s dollar-linked stablecoin backed by cash and low-risk assets. Circle’s business is notably exposed to U.S. rate moves, since it earns reserve income on USDC’s backing. CEO Jeremy Allaire told Reuters that “further cuts this year are ‘welcome’.” Seaport Research Partners’ Jeff Cantwell pointed out, “USDC continues scaling rapidly.” Reuters
Circle reported USDC circulation reaching $75.3 billion at the close of 2025, a 72% jump from the year before. Fourth-quarter total revenue and reserve income climbed 77% to $770 million, with net income from continuing operations at $133 million. For 2026, the company projects “other revenue” between $150 million and $170 million. Arc, Circle’s upcoming layer-1 blockchain meant to serve as the backbone for new on-chain applications, is averaging 2.3 million daily transactions in testnet. The Circle Payments Network, for its part, has 55 financial institutions enrolled. “The fourth quarter marked another step forward” toward an “open, programmable internet financial system,” Allaire said in the earnings release. SEC
Needham dropped its price target on Circle to $130 from $190 but stuck with a Buy, pointing to revised interest-rate expectations and recent crypto price weakness, both of which could slow USDC supply growth. Still, the firm flagged potential in on-chain micropayments — think AI agents making frequent, tiny payments — and the ongoing move to tokenization, where real-world assets are turned into digital tokens on the blockchain.
Morgan Stanley bumped its price target up to $80 from $66 while sticking with its Equalweight rating. The firm pointed to quicker gains in non-reserve revenue, like the payments network, as a possible boost for earnings down the line. Valuation? They’re using a 25-times earnings multiple, lining it up with longer-term averages at Visa and Mastercard.
Circle’s surge this week is spotlighting the tension in its business: rising short-term rates fatten reserve income, yet the firm maintains that falling rates might kick up activity by making money move faster and fueling demand for digital dollars.
But stablecoin expansion isn’t guaranteed. If crypto markets sink further, that could choke off activity and stall new USDC inflows. Plus, Tether and other heavyweight competitors are keeping the squeeze on both pricing and distribution.
Traders are eyeing Circle’s attempts to expand revenue beyond reserve income, looking for signs of early traction in run-rate figures linked to payments, transactions, and fresh infrastructure offerings.
Traders are watching Friday, March 6: the U.S. February jobs numbers land then, and expectations are set at a modest 60,000 payroll gain, according to a Reuters poll. That figure could end up realigning bets on when the Federal Reserve moves to cut rates.
