What happened

Shares of Mobileye (MBLY 2.51%), the self-driving vehicle technology company, were falling today after it slashed its full-year guidance in its first-quarter earnings report.

As a result, the stock is down 21.8% as of 10:53 a.m. ET.

So what

Revenue in the quarter rose 16% to $458 million, slightly ahead of the consensus at $456.7 million; the company said both its EyeQ and SuperVision businesses grew strongly in the quarter, outpacing the global auto production market.

The company touted growth in its backlog, saying it expects to top $6.7 billion by the end of the year.

Further down the income statement, gross margin in the quarter remained steady at 45%, but its operating loss widened from $46 million to $81 million. Adjusted earnings per share declined from $0.16 to $0.14, but that still topped estimates at $0.12.

Despite the solid growth in the quarter, the company noted headwinds lowering electric vehicle (EV) demand in China, which led it to reduce its 2023 SuperVision shipment forecast.

Management added, "We see this as a temporary issue that should not impact the potential for this business to accelerate our top- and bottom-line growth as it scales, diversifies, and becomes more predictable."

Now what

For the full year, the company said the lower-than-expected SuperVision volumes would lead to a 6.5% reduction in its revenue and adjusted operating income guidance.

As a result, it now sees revenue of $2.07 billion to $2.11 billion for the year, down from its previous forecast of $2.19 billion to $2.28 billion, which was below the consensus at $2.25 billion. Similarly, it now expects an adjusted operating income of $548 million to $577 million, down from its prior range of $577 million to $627 million.

Investors have already witnessed a number of false starts and disappointments in the autonomous vehicle industry, so the sell-off isn't a surprise, even if management believes the headwinds are temporary.