Ridgewood Energy Q Fund's Net Income Plummets 57% Amid Revenue Decline

TL;DR

**Ridgewood Energy Q Fund is bleeding cash, with net income down 57% – time to bail on this oil and gas play.**

AI Summary

Ridgewood Energy Q Fund, LLC reported a significant decline in net income for the nine months ended September 30, 2025, falling to $457 thousand from $1,073 thousand in the prior year, a 57.4% decrease. Total revenue also saw a substantial drop, decreasing by 31.5% to $1,644 thousand from $2,401 thousand in the same period. This was primarily driven by a 35.9% reduction in oil and gas revenue, which fell from $2,243 thousand in 2024 to $1,436 thousand in 2025. Operating expenses increased to $396 thousand from $351 thousand, and general and administrative expenses rose to $205 thousand from $184 thousand. Despite these declines, cash and cash equivalents increased to $2,149 thousand as of September 30, 2025, up from $1,558 thousand at December 31, 2024. The Fund's total assets slightly increased to $5,756 thousand from $5,698 thousand, while total liabilities rose to $1,461 thousand from $1,361 thousand, largely due to an increase in asset retirement obligations to $1,368 thousand. The Fund expects cash flow from operations to cover its $3.6 million in estimated capital commitments, including $2.0 million for asset retirement obligations.

Why It Matters

This significant drop in net income and revenue for Ridgewood Energy Q Fund, LLC signals potential challenges in its oil and gas property investments, directly impacting investor returns. The decline in oil and gas revenue by 35.9% suggests either lower production volumes or unfavorable commodity prices, which could affect the fund's ability to generate future distributions for its shareholders. For employees, sustained revenue declines could lead to operational adjustments. In a competitive energy market, this performance could make it harder for the Fund to attract new capital or maintain its current asset base, especially with rising asset retirement obligations.

Risk Assessment

Risk Level: high — The Fund exhibits high risk due to a 57.4% decline in net income for the nine months ended September 30, 2025, falling to $457 thousand from $1,073 thousand in the prior year. This is coupled with a 35.9% reduction in oil and gas revenue, indicating significant operational headwinds and potential long-term sustainability issues, despite an increase in cash and cash equivalents.

Analyst Insight

Investors should consider divesting from Ridgewood Energy Q Fund, LLC given the substantial 57.4% decline in net income and 35.9% drop in oil and gas revenue. The rising asset retirement obligations to $1,368 thousand also present a future financial burden that could further erode returns.

Financial Highlights

debt To Equity

0.34

revenue

$1,644 thousand

operating Margin

22.9%

total Assets

$5,756 thousand

total Debt

$1,461 thousand

net Income

$457 thousand

eps

$354

gross Margin

N/A

cash Position

$2,149 thousand

revenue Growth

-31.5%

Revenue Breakdown

Key Numbers

• $457 thousand — Net income for nine months ended Sep 30, 2025 (Decreased from $1,073 thousand in 2024, a 57.4% decline)
• $1,436 thousand — Oil and gas revenue for nine months ended Sep 30, 2025 (Decreased from $2,243 thousand in 2024, a 35.9% decline)
• $1,644 thousand — Total revenue for nine months ended Sep 30, 2025 (Decreased from $2,401 thousand in 2024, a 31.5% decline)
• $2,149 thousand — Cash and cash equivalents as of Sep 30, 2025 (Increased from $1,558 thousand at Dec 31, 2024)
• $1,368 thousand — Asset retirement obligations as of Sep 30, 2025 (Increased from $1,280 thousand at Dec 31, 2024)
• $3.6 million — Estimated capital commitments as of Sep 30, 2025 (Includes $2.0 million for asset retirement obligations)
• 830.5577 — LLC Membership Interest shares outstanding (As of November 4, 2025)

Key Players & Entities

• RIDGEWOOD ENERGY Q FUND LLC (company) — Registrant
• Ridgewood Energy Corporation (company) — Manager of the Fund
• Beta Sales and Transport, LLC (company) — Wholly-owned subsidiary of the Manager
• SEC (regulator) — Securities and Exchange Commission
• Delaware (location) — State of incorporation
• Gulf of America (location) — Location of oil and gas properties
• Financial Accounting Standards Board (regulator) — Issued accounting guidance

FAQ

Risk Factors

• Commodity Price Volatility [high — market]: The Fund's revenue is heavily dependent on the fluctuating prices of oil and natural gas. A significant decline in commodity prices, as seen with oil and gas revenue decreasing by 35.9% to $1,436 thousand for the nine months ended September 30, 2025, directly impacts profitability and cash flows.
• Asset Retirement Obligations [medium — operational]: The Fund has substantial asset retirement obligations (AROs) totaling $1,368 thousand as of September 30, 2025, an increase from $1,280 thousand at year-end 2024. These obligations represent future costs for decommissioning oil and gas properties, which could strain cash flow, especially given the current revenue decline.
• Declining Net Income and Revenue [high — financial]: Net income for the nine months ended September 30, 2025, fell by 57.4% to $457 thousand from $1,073 thousand in the prior year. Total revenue also decreased by 31.5% to $1,644 thousand. This trend indicates potential financial distress if not reversed.
• Increased Operating Expenses [medium — operational]: Operating expenses increased to $396 thousand from $351 thousand for the nine months ended September 30, 2025, and general and administrative expenses rose to $205 thousand from $184 thousand. These increases, coupled with declining revenue, put pressure on margins.

Industry Context

The oil and gas industry is characterized by high capital intensity, cyclical commodity prices, and significant regulatory oversight. Companies in this sector face ongoing challenges related to exploration, production, environmental compliance, and the transition towards cleaner energy sources. Recent market conditions have seen price volatility impacting revenues and profitability.

Regulatory Implications

The Fund must comply with environmental regulations concerning asset retirement and decommissioning, as evidenced by the significant Asset Retirement Obligations. Changes in environmental laws or stricter enforcement could increase future costs. Additionally, standard financial reporting regulations require accurate disclosure of financial performance and risks.

What Investors Should Do

1. Monitor commodity price trends
2. Analyze the management of asset retirement obligations
3. Evaluate expense management strategies
4. Assess the sustainability of cash flow

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 — Period marked by significant declines in revenue and net income, alongside an increase in asset retirement obligations.
• 2025-12-31: As of December 31, 2024 — Prior period balance sheet reference point, showing lower cash and AROs compared to September 30, 2025.
• 2025-11-04: As of November 4, 2025 — Date for which LLC Membership Interest shares outstanding (830.5577) were reported.

Glossary

Asset Retirement Obligations (AROs)

The estimated future costs associated with the retirement of tangible long-lived assets. For oil and gas companies, this typically includes the costs of plugging wells and dismantling facilities. (A significant liability for the Fund, increasing to $1,368 thousand, representing future cash outflows.)

Depletion and amortization

Expenses recognized for the consumption of natural resources (depletion) and the allocation of the cost of intangible assets over their useful lives (amortization). (A major expense category for the Fund, decreasing to $667 thousand for the nine months ended September 30, 2025, reflecting lower production or reserves.)

Salvage fund

A fund set aside to cover costs related to the salvage or disposal of assets, often related to environmental or decommissioning requirements. (The Fund holds $1,781 thousand in its salvage fund as of September 30, 2025, likely related to asset retirement obligations.)

LLC Membership Interest

Represents ownership units in a Limited Liability Company (LLC). (The number of outstanding shares (830.5577) is provided, indicating the ownership structure.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, Ridgewood Energy Q Fund LLC experienced a substantial downturn. Total revenue decreased by 31.5% to $1,644 thousand, primarily driven by a 35.9% drop in oil and gas revenue. Net income saw an even steeper decline of 57.4%, falling to $457 thousand. Operating expenses and general and administrative expenses both increased, further pressuring profitability. However, the Fund's cash position improved, and total assets saw a slight increase, while liabilities grew due to higher asset retirement obligations.

Filing Documents

• q101425410q.htm (10-Q) — 372KB
• ex31_1.htm (EX-31.1) — 9KB
• ex31_2.htm (EX-31.2) — 9KB
• ex32.htm (EX-32) — 8KB
• 0001214659-25-015880.txt ( ) — 1756KB
• cik0001338474-20250930.xsd (EX-101.SCH) — 18KB
• cik0001338474-20250930_cal.xml (EX-101.CAL) — 28KB
• cik0001338474-20250930_def.xml (EX-101.DEF) — 22KB
• cik0001338474-20250930_lab.xml (EX-101.LAB) — 140KB
• cik0001338474-20250930_pre.xml (EX-101.PRE) — 92KB
• q101425410q_htm.xml (XML) — 182KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 1 Unaudited Condensed Balance Sheets as of September 30, 2025 and December 31, 2024 1 Unaudited Condensed Statements of Operations for the three and nine months ended September 30, 2025 and 2024 2 Unaudited Condensed Statements of Changes in Members' Capital for the nine months ended September 30, 2025 and 2024 3 Unaudited Condensed Statements of Cash Flows for the nine months ended September 30, 2025 and 2024 4 Notes to Unaudited Condensed Financial Statements 5 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 11 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 16 Item 4.

Controls and Procedures

Controls and Procedures 16

- OTHER INFORMATION

PART II - OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 17 Item 1A.

Risk Factors

Risk Factors 17 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 17 Item 3. Defaults Upon Senior Securities 17 Item 4. Mine Safety Disclosures 17 Item 5. Other Information 17 Item 6. Exhibits 18

SIGNATURES

SIGNATURES 19 Table of Contents

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS RIDGEWOOD ENERGY Q FUND, LLC UNAUDITED CONDENSED BALANCE SHEETS (in thousands, except share data) September 30, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 2,149 $ 1,558 Production receivable 127 195 Due from affiliate (Note 2) 16 21 Other current assets 61 42 Total current assets 2,353 1,816 Salvage fund 1,781 1,631 Oil and gas properties: Proved properties 24,961 24,923 Less: accumulated depletion and amortization ( 23,339 ) ( 22,672 ) Total oil and gas properties, net 1,622 2,251 Total assets $ 5,756 $ 5,698 Liabilities and Members' Capital Current liabilities: Due to operators $ 38 $ 23 Accrued expenses 55 58 Total current liabilities 93 81 Asset retirement obligations 1,368 1,280 Total liabilities 1,461 1,361 Commitments and contingencies (Note 3) Members' capital: Manager: Distributions ( 9,629 ) ( 9,555 ) Retained earnings 9,270 9,107 Manager's total ( 359 ) ( 448 ) Shareholders: Capital contributions ( 1,335 shares authorized; 830.5577 issued and outstanding) 123,037 123,037 Syndication costs ( 14,070 ) ( 14,070 ) Distributions ( 54,562 ) ( 54,137 ) Accumulated deficit ( 49,751 ) ( 50,045 ) Shareholders' total 4,654 4,785 Total members' capital 4,295 4,337 Total liabilities and members' capital $ 5,756 $ 5,698 The accompanying notes are an integral part of these unaudited condensed financial statements. 1 Table of Contents RIDGEWOOD ENERGY Q FUND, LLC UNAUDITED CONDENSED STATEMENTS OF OPERATIONS (in thousands, except per share data) Three months ended September 30, Nine months ended September 30, 2025 2024 2025 2024 Revenue Oil and gas revenue $ 399 $ 674 $ 1,436 $ 2,243 Other revenue 60 72 208 158 Total revenue 459 746 1,644 2,401 Expenses Depletion and amortization 197 277 667 881 Operating expenses 128 120 396 351 Gene

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