By Nicholas Brown, Tech & Politics Correspondent, Stock Trader Network

Tesla’s (TSLA) post-earnings decline deepened during Wednesday’s call as Chief Executive Elon Musk described safety and regulatory scrutiny as constraints on scaling the company’s Robotaxi service, remarks that coincided with a fresh leg lower in the stock.

“We do need to be cautious about causing any accidents or causing any harm to anyone,” Musk said. Tesla shares, which traded near $363 at 5:35 p.m. ET, fell to $356.18 by 5:50 p.m. and settled around $355.92 shortly afterward.

The stock was already under pressure after Tesla reported a second-quarter profit miss and negative free cash flow. Quarterly capital spending climbed to $5.8 billion, and the company expects to spend more than $25 billion this year on Robotaxi, Optimus and manufacturing projects.

That spending has made the pace of Tesla’s Robotaxi expansion increasingly important to investors. Musk said the company is moving “as fast as humanly possible,” but acknowledged that a serious accident could quickly bring regulatory intervention.

“If we injure even one person, it’ll be worldwide headline news, and regulators will immediately clamp down on our activities,” Musk said.

The warning highlighted a central challenge for Tesla. Robotaxi is a major part of the company’s long-term growth plans, but its expansion depends on more than manufacturing capacity and technological progress. It also requires regulators and the public to accept Tesla’s safety record.

“That’s really the constraint is we want to grow as fast as possible with Robotaxi without harm to anyone,” Musk said.

Ivan Feinseth, partner, chief investment officer and director of research at Tigress Financial Partners, told Stock Trader Network that Musk’s caution “was framed around regulatory optics as much as safety.”

The comments “read more as expectations-management than a new commitment,” Feinseth said, adding that Musk has previously used ambitious safety benchmarks to explain a measured rollout.

“The data backs a controlled pilot view,” Feinseth said.

Tesla operates in “just six-to-seven metros with roughly 21 active unsupervised vehicles,” according to Feinseth. He said paid Robotaxi miles fell about 36% from the previous quarter, to approximately 700,000 from 1.1 million, even as Tesla expanded the service’s geographic footprint.

Feinseth also said Tesla’s more than 380,000 cumulative unsupervised miles are roughly equal to the distance Waymo covers in one day. He identified the amount of safety data available for the Cybercab, rather than Tesla’s ability to manufacture the vehicle, as the primary obstacle to expansion.

“The real bottleneck is Cybercab-specific safety data needed before mass deployment, not manufacturing,” Feinseth said.

Musk offered a more optimistic assessment of the rollout, saying Robotaxi miles are increasing by more than 10% each week. Tesla has also continued announcing new markets for the service as it works to expand without triggering the type of incident Musk warned could draw regulatory scrutiny.

“Bottom line: this looks like a headline-risk-managed pilot, not an imminent scaling inflection,” Feinseth said.

Feinseth said Tesla’s declining paid miles and limited active fleet point to a longer path toward scale, helping explain “why the market punished the stock despite the delivery beat.” He nevertheless called the selloff “a buying opportunity.”

Tesla shares were recently down over 14% at $320.87.