MONTEREY, Calif. -- Telecommunications companies like
are experiencing tough times, but one of their suppliers says that isn't translating into demands for lower prices.
Applied Micro Circuits
said that because it designs chips specifically for individual company applications, its customers haven't been trying to whittle down the prices of its goods. Not the ones on the market now, and not the ones coming onto the market.
"We really haven't seen the pricing pressures that
you would expect from our customers," Applied Micro Circuits Chief Financial Officer Bill Bendush said Thursday during a
Salomon Smith Barney
semiconductor conference here.
"There is a lot of interest in pricing at the time of the design wins, but I wouldn't say that environment has changed in the last few months," Bendush added.
And as Applied Micro builds higher performance products, pricing becomes even less important, said Doug Spreng, CEO of Applied Micro's
business. "All they really care about is what you have and how quickly it can get to market. Pricing is just way down on the list."
Communications chips companies like Applied Micro have seen their orders fall dramatically in recent months as telecommunications providers tightened up on spending and networking companies' inventories increased. Add to that a macroeconomic downturn and it becomes clear that it will be
many months before either the telecommunications sector or the communications chip makers will see their orders pick up. That, some analysts have said, means that broad-based pricing pressures are going to start taking hold during the second and third quarters.
Meanwhile, Bendush Thursday reiterated
comments that the company made during its conference call last month about orders falling, but he declined to update investors on how orders may have changed since then.