It’s not often a stock tanks after reporting both an earnings and revenue beat, but that’s exactly what happened to BTP Special Situations Portfolio holding Mobileye (NYSE: MBLY) this morning.

In its second quarter earnings report released earlier this morning, Mobileye revealed that revenue shot up 58% year-over-year to $83.5 million. Earnings also came in at 17 cents, well up from 7 cents in the year-ago period. Management also bumped its full-year revenue guidance from $336 million – $340 million to $344 million – $350 million. Full-year EPS is also now expected to be at least 70 cents, compared to the current consensus estimate of 68 cents.

Since analysts had been predicting revenue of $77 million with earnings of 15 cents, you’d think the news would send the shares sharply higher. Instead, Mobileye actually opened 10% lower this morning after management said during the conference call that it would not “go beyond (supplying) EyeQ3 chips” to Tesla.

Since Tesla has been a major customer for Mobileye, the news understandably rattled some nerves. Short sellers are already hitting the airwaves talking about how this is bad news for Mobileye. Mobileye hasn’t really helped its case by staying mum about who ended what, but I think the move makes some sense for a couple of reasons.

A Tesla Model S crashed while it was in autopilot mode in May, marking the first known fatality involving a self-driving car. While the National Highway Traffic Safety Administration (NHTSA) still investigating the precise cause, Tesla maintains that the circumstances of the accident resulted in a set of conditions where the vehicle simply couldn’t detect the threat. The tractor trailer which caused the accident crossed the highway perpendicularly to the low-slung Model S so, with the high-ride of the trailer, the car’s sensors just saw open road ahead of it and failed to brake.

While one fatality rarely results in a recall, it is within NHTSA’s authority to order one. Since every Tesla that has rolled out of the factory since September 2014 is technically equipped with autopilot, that could get very expensive. With Tesla maintaining that the accident was essentially a sensor failure, and those sensors are mostly provided by Mobileye, it sounds as though Tesla is trying to shift at least some of the blame.

Even a single fatality tied to driverless cars is one too many, especially since that is exactly what they’re supposed to prevent. However, I suspect Mobileye has been worried about how Tesla is spinning the circumstances of the accident and sees a benefit to putting some distance between it and Tesla.

The reason is Mobileye’s recently inked agreement to develop driverless cars in collaboration with BMW and Intel. I would guess Tesla wasn’t happy with that development, but Mobileye saw the benefit to advancing the technology using vehicles with a lower price point.

Right now the lowest sticker price on a new Tesla is $66,000 and there’s still a waitlist. There are only so many people that can pony up that kind of cash for a car, especially an electric one with limited range at that. By partnering with BMW, Mobileye is making the educated bet that once the car is developed, BMW will be able to move more vehicles with its technology set than Tesla will anytime soon. And when it comes to sales of any kind of vehicle, volume does matter.

So given the circumstances of this parting of ways, I don’t see a real reason to worry. Obviously Mobileye doesn’t either, otherwise it wouldn’t have boosted its guidance knowing it was going to make this announcement on the same day. This is simply a case of Mobileye wanting to take the road more travelled.

Continue buying Mobileye up to $50.