The numbers show that smartphones sales are slowing down. But ARM, the semiconductor firm that develops the technology behind nearly all of the world’s 3 billion phones, believes there is still plenty of room for growth. It says that new applications including digital assistants, high-quality games, and virtual reality and augmented reality will drive demand for faster and more efficient phones.

Despite the debate about peak smartphone, “we are very, very bullish actually on the smartphone market,” Executive Vice President Rene Haas said at the company’s Computex press conference this week where it announced new processor and graphics designs to power these emerging applications.

The new high-performance CPU core, the Cortex-A73 known as “Artemis,” was expected. Last week ARM and its manufacturing partner, TSMC, announced a 10nm test chip with an Artemis quad-core CPU. But now that ARM is ready to discuss the details, it looks more impressive.

In comparison the current Cortex-A72, the A73 is a new design with a shorter pipeline, improved memory throughput and bandwidth, and better branch prediction. It is more similar to the Cortex-A17 and the emphasis is on efficiency–perhaps an acknowledgement that some of the most recent 20nm and 16nm designs using Cortex-A57 and A72 cores are hitting power ceilings.

ARM says a 10nm 2.8GHz A73 CPU core will deliver 30 percent higher sustained performance in a smartphone power budget (around 750 milliwatts) than a 16nm 2.5GHz A72–and double the performance of a 20nm 1.9GHz A57. It is also more efficient. On the same manufacturing process and power, the A73 uses 20 percent less power and is 25 percent smaller. At 10nm, an A73 core measures only 0.65 square millimeters–less than half the size of a 16nm A72 core–and ARM says a 2.8GHz A73 quad-core CPU with 2MB L2 cache for a high-end smartphone will use a total of around 5 square millimeters of die area (this obviously does not include all the other components of an application processor such as graphics).

Speaking of graphics, ARM also announced a new Mali GPU designed to work with the A73 in 10nm mobile SoCs. In comparison to the Midgard architecture in the current Mali-T600, T700 and T800 GPUs, the ‘Bifrost’ design uses a new instruction set that is more energy-efficient, has full memory coherency for heterogeneous computing and was built from the ground up for the Vulkan graphics API, which promises lower CPU utilization and higher performance.

The first Bifrost GPU, the Mali-G71, will be 50 percent faster than the current top-of-the-line Mali-T880. However, the Mali-T880 tops out at 16 cores while the G71 will scale up to 32 cores “so there’s a lot more upside on performance with the Mali-G71,” said Nandan Nayampally, ARM’s VP of Marketing for the processor group. More interesting, ARM said that a 10nm mobile application processor with the Mali-G71 will deliver better graphics performance than a mid-range laptop with a discrete graphics (defined as an Intel Core i5 processor and Nvidia GeForce 940M GPU).

Why would you need all this graphics horsepower in a phone? One of the most demanding applications will be virtual reality, which Nayampally said will require resolutions up to 4K at 120 frames per second, low latency (a four milliseconds or less graphics pipeline) and 4x multi-sampling antialiasing so that it looks nice and smooth. And you need to double this to cover each eye–all in a smartphone that is continually getting thinner and lighter. The current VR headsets, the HTC Vive and Oculus Rift, which both need to be tethered to high-end PCs, show that there’s a long way to go to deliver high-quality VR in a truly mobile device, though how much demand there will be for it remains an open question.

ARM said that 10 companies have licensed the Cortex-A73 and nine have licensed the Mali-G71 to use in their chip designs. It mentioned five of them–HiSilicon, Huawei, Marvell, MediaTek and Samsung–at the press conference and said the first SoCs could show up in devices by the end of this year. Foundry TSMC has said 10nm will be available by the end of the year, though it won’t start volume production until 2017, so most of these chips are likely to debut at Mobile World Congress next year.