Phoenix Energy One, LLC Revenue Disclosure
Note 4. Revenue
Revenue from contracts with customers is presented as product sales and mineral and royalty revenues on the consolidated statements of operations. PhoenixOp typically receives payment monthly for the commodities it extracts and delivers to purchasers, and the Company is paid mineral and royalty revenue monthly by the various operators and working interest owners within the pooled units that the Company owns. Product sales revenues within the operating segment are presented separately from post-production costs, including transportation costs, whereas mineral and royalty revenues within the mineral and non-operating segment are presented net of post-production costs charged by the operator, on the consolidated statements of operations. Other costs, including severance taxes and lease operating expenses are presented as cost of sales on the consolidated statements of operations for both the operating and mineral and non-operating segments.
The Company generates revenues from the purchase of crude oil from working interest owners and royalty interest holders in properties operated by PhoenixOp, and the subsequent sale of the crude oil to customers. The
Company acts as the principal in these transactions and therefore recognizes the associated revenues and purchase costs on a gross basis in accordance with ASC 606.
The Company also generates revenues from performing saltwater disposal services on wells in which it is the operator. Revenues are driven primarily by the volumes of produced water and flowback water the Company injects into its saltwater disposal facilities and the fees the Company charges for these services. Fees are charged on a per-barrel basis and are recognized as revenues in accordance with ASC 606.
Other revenue is comprised of redemption fees that are charged to investors, generally upon the early redemption of their investments. For the securities segment, other revenue also includes intersegment interest revenue earned from the operating and mineral and non-operating segments that is eliminated on the consolidated statements of operations.
The following tables present the Company’s revenue from contracts with customers and other revenue for the years ended December 31, 2025, 2024, and 2023, by segment:
|
|
Year Ended December 31, 2025 |
|
|||||||||||||||||
(in thousands) |
|
Operating |
|
|
Mineral and |
|
|
Securities |
|
|
Eliminations |
|
|
Total |
|
|||||
Product sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Crude oil |
|
$ |
426,415 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
426,415 |
|
Natural gas |
|
|
2,318 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,318 |
|
NGL |
|
|
8,688 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,688 |
|
Total product sales |
|
|
437,421 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
437,421 |
|
Mineral and royalty revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Crude oil |
|
|
— |
|
|
|
113,065 |
|
|
|
— |
|
|
|
126 |
|
|
|
113,191 |
|
Natural gas |
|
|
— |
|
|
|
5,616 |
|
|
|
— |
|
|
|
— |
|
|
|
5,616 |
|
NGL |
|
|
— |
|
|
|
6,192 |
|
|
|
— |
|
|
|
— |
|
|
|
6,192 |
|
Total mineral and royalty revenues |
|
|
— |
|
|
|
124,873 |
|
|
|
— |
|
|
|
126 |
|
|
|
124,999 |
|
Purchased crude oil sales |
|
|
113,547 |
|
|
|
— |
|
|
|
— |
|
|
|
(126 |
) |
|
|
113,421 |
|
Water services |
|
|
10,777 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,777 |
|
Other revenue |
|
|
— |
|
|
|
— |
|
|
|
562 |
|
|
|
— |
|
|
|
562 |
|
Intersegment revenue |
|
|
— |
|
|
|
351 |
|
|
|
140,232 |
|
|
|
(140,583 |
) |
|
|
— |
|
Total revenues |
|
$ |
561,745 |
|
|
$ |
125,224 |
|
|
$ |
140,794 |
|
|
$ |
(140,583 |
) |
|
$ |
687,180 |
|
|
|
Year Ended December 31, 2024 |
|
|||||||||||||||||
(in thousands) |
|
Operating |
|
|
Mineral and |
|
|
Securities |
|
|
Eliminations |
|
|
Total |
|
|||||
Product sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Crude oil |
|
$ |
123,340 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
123,340 |
|
Natural gas |
|
|
315 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
315 |
|
NGL |
|
|
1,994 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,994 |
|
Total product sales |
|
|
125,649 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
125,649 |
|
Mineral and royalty revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Crude oil |
|
|
— |
|
|
|
138,640 |
|
|
|
— |
|
|
|
— |
|
|
|
138,640 |
|
Natural gas |
|
|
— |
|
|
|
5,424 |
|
|
|
— |
|
|
|
— |
|
|
|
5,424 |
|
NGL |
|
|
— |
|
|
|
8,935 |
|
|
|
— |
|
|
|
— |
|
|
|
8,935 |
|
Total mineral and royalty revenues |
|
|
— |
|
|
|
152,999 |
|
|
|
— |
|
|
|
— |
|
|
|
152,999 |
|
Water services |
|
|
2,478 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,478 |
|
Other revenue |
|
|
— |
|
|
|
— |
|
|
|
101 |
|
|
|
— |
|
|
|
101 |
|
Intersegment revenue |
|
|
— |
|
|
|
136 |
|
|
|
102,030 |
|
|
|
(102,166 |
) |
|
|
— |
|
Total revenues |
|
$ |
128,127 |
|
|
$ |
153,135 |
|
|
$ |
102,131 |
|
|
$ |
(102,166 |
) |
|
$ |
281,227 |
|
|
|
Year Ended December 31, 2023 |
|
|||||||||||||||||
(in thousands) |
|
Operating |
|
|
Mineral and |
|
|
Securities |
|
|
Eliminations |
|
|
Total |
|
|||||
Mineral and royalty revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Crude oil |
|
$ |
1,140 |
|
|
$ |
104,631 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
105,771 |
|
Natural gas |
|
|
14 |
|
|
|
6,776 |
|
|
|
|
|
|
|
|
|
6,790 |
|
||
NGL |
|
|
71 |
|
|
|
5,456 |
|
|
|
|
|
|
|
|
|
5,527 |
|
||
Total mineral and royalty revenues |
|
|
1,225 |
|
|
|
116,863 |
|
|
|
— |
|
|
|
— |
|
|
|
118,088 |
|
Other revenue |
|
|
— |
|
|
|
— |
|
|
|
17 |
|
|
|
— |
|
|
|
17 |
|
Intersegment revenue |
|
|
— |
|
|
|
39 |
|
|
|
40,492 |
|
|
|
(40,531 |
) |
|
|
— |
|
Total revenues |
|
$ |
1,225 |
|
|
$ |
116,902 |
|
|
$ |
40,509 |
|
|
$ |
(40,531 |
) |
|
$ |
118,105 |
|
Customer Concentration
The following table summarizes major customers that make up 10% or more of accounts receivable as of December 31, 2025 and 2024:
|
|
December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Customer A |
|
|
13.0 |
% |
|
|
— |
% |
Customer B |
|
|
13.0 |
% |
|
|
17.0 |
% |
Customer C |
|
|
— |
% |
|
|
15.0 |
% |
Customer D |
|
|
— |
% |
|
|
13.0 |
% |
The following table summarizes major customers that make up 10% or more of revenue for the years ended December 31, 2025, 2024, and 2023:
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Customer A |
|
|
40.0 |
% |
|
|
— |
% |
|
|
— |
% |
Customer E |
|
|
— |
% |
|
|
21.0 |
% |
|
|
— |
% |
Customer F |
|
|
— |
% |
|
|
— |
% |
|
|
11.0 |
% |
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About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.