Qualcomm and Virata are pinning their hopes on growth in Asian markets in 2002 to help drive them out of the current slowdown.
Qualcomm is looking to the expansion of CDMA wireless networks in China and South Korea next year, with plans in India to build limited-mobility networks by the end of 2002.
Irwin Jacobs, chairman and CEO of Qualcomm, said: "3G CDMA2000 is now offering data services in Korea. Next year, the US and Japan will start offering 150kbit/s and 300kbit/s datarates much sooner than other networks."
He said the company received its first orders for the China Unicom buildout in Q3, boosting sales of basestation chips. But CFO Tony Thornley said the company's revenues were reduced by satellite-communications operator Globalstar's problems and lower shipments of chips for terminals, adding that royalty increases.
Some staff working on Globalstar development have been shifted to other parts of Qualcomm.
For Q32001, the company saw overall sales drop 20% from the same quarter last year to $640m. Including the effects of money lost on investments in the Brazilian operator Vesper Telecom and losses in other investments that are expected to be temporary, the company reported a net loss of $274m. On a pro-forma basis, the company saw net profits fall 20% to $174m.
Virata saw strong growth in South-East Asia and Germany. Its two biggest customers, Ambit and Siemens, accounted for 50.0% and 19.9% in its last quarter. It saw 66.1% of its sales go into Asia.
Charles Cotton, president and CEO, said: "We are seeing continuing strong demand from Taiwan and other markets, such as China and Japan.
"The US is passing the fast growth baton [in DSL] to Asia and Europe."
He said the company was reasonably well insulated by falling prices in physical-layer chips as it has concentrated on the transmission controllers.
Virata reported sales of $20.3m for Q12002, which ended 1 July, down 27% from the same quarter last year. It made a net loss of $44.6m compared with $12.8m last year on the back of higher R&D costs and the effects of amortisation from recent buys.
Cotton said he expected sales to increase 20% next quarter.
"Channel inventories have reduced to where [customers] need to place new orders. But we are not expecting OEMs to place orders until they have committed delivery schedules from their customers. We expect very few long-term orders and will be reliant on turns orders."