Tesla, Inc. (TSLA) shares slipped 0.3% in extended trading on Wednesday after CEO Elon Musk said the EV maker’s latest self-driving hardware “simply does not have the capability” to support fully driverless operations. During the earnings call, Musk acknowledged that Hardware 3 cannot support unsupervised Full Self-Driving (FSD), noting the platform has only one-eighth the memory bandwidth of Hardware 4. Tesla said customers who purchased FSD will be offered discounted trade-ins for vehicles equipped with Hardware 4, as well as the option to upgrade existing vehicles by replacing both the computer and cameras. Musk said unsupervised FSD rollout could begin gradually in Q4, but added robotaxi-related revenue “will not be super material this year.” The company raised its expected annual capex above $25 billion for this year, with CFO Vaibhav Taneja calling it a “very big capital investment phase.” The comments accompanied first-quarter (Q1) results that topped consensus estimates but were accompanied by higher spending plans and expectations of negative free cash flow through the remainder of the year.