Bernstein maintained a $190 target on Circle, citing Arc’s $222M presale and continued USDC supply growth.
Analysts at Bernstein maintained an Outperform rating and a $190 price target on Circle Internet Group on May 12, pointing to the company's $222 million Arc token presale and stable USDC supply growth as offsets to declining reserve income. The target implies approximately 44% upside from Circle's May 11 closing price of $131.76.
In a note to clients led by analyst Gautam Chhugani, Bernstein described Circle's first-quarter adjusted EBITDA of $151 million as coming in roughly 10% above consensus estimates. Q1 total revenue of $694 million missed estimates by approximately 4%, driven primarily by a decline in reserve income, which fell 11% quarter-over-quarter as interest rates weakened.
The $222 million presale for Arc, Circle's layer-1 blockchain, was conducted at a $3 billion fully diluted valuation with participation from a16z crypto, BlackRock, Apollo, and Intercontinental Exchange. Bernstein described it as providing a near-term buffer against the pressure from lower reserve income.
USDC supply reached $77 billion in Q1, up 28% year-over-year and 2% from the prior quarter. On-platform USDC balances climbed to $13.7 billion, equal to 18% of total supply, even as the broader crypto market declined roughly 40% from its October 2025 peak.
The note highlighted Circle's payments infrastructure scaling, with the Circle Payments Network reporting annualized transaction volume approaching $10 billion and 136 financial institutions onboarded as of May 7. Active partnerships include Meta, DoorDash, and Kyriba.
Bernstein also pointed to Arc's testnet performance, which logged over 244 million cumulative transactions and 1.6 million unique wallets before its mainnet launch. The analysts noted that Arc's x402 open standard for machine-to-machine micropayments positions USDC to serve AI-driven software agents, a category in which USDC currently already settles over 99% of all x402-based agentic payments globally.
Circle's fiscal year 2026 guidance remains unchanged, targeting a 40% compound annual growth rate for USDC supply and non-float revenue between $150 million and $170 million. The guidance does not yet include the financial impact of the Arc presale, which Bernstein said will be recognized as other revenue upon token delivery.
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