Cable doesn’t seem like a great business to be in, for the most part. Younger consumers are cutting the cord in increasing numbers, and opting instead for streaming “over the top” services like Netflix (NFLX) and Hulu. That not only means subscriber numbers are dropping, but cable providers are losing a lot of the leverage they used to have with media companies as a result. So how come Comcast seems to be doing so well?
On Monday, the cable and entertainment conglomerate reported better than expected revenue of $18.7 billion for the most recent quarter, up more than 11% over the same period the previous year. And it wasn’t just the movie or TV parts of the company under NBCUniversal that produced all the good news—although the Minions animated movie and Jurassic World definitely helped lift the company’s financial performance.
While Comcast’s cable operations saw another decline in the number of subscribers, the drop was one of the smallest the company has seen in some time: It lost just 48,000 subscribers in the most recent quarter—that’s a little over half of what it lost in the same period last year, and its best third-quarter performance in almost a decade. The company’s cable unit saw revenue climb by more than 6%, to $11.7 billion.
Comcast’s stock (CMCSA) didn’t exactly rocket higher on the news—in fact, it was down slightly for most of the day, about 1% lower. In part, that’s because investors will likely continue to be worried about the impact of cord cutting, despite the better than expected numbers. But it’s also because Comcast’s share price has bounced back substantially over the past month or s after it got caught up in a big share selloff of TV-related companies.
That drop, which was precipitated in part by ESPN’s lackluster subscriber numbers, took the entire sector down by almost 10% in a matter of days. Comcast fell as low as $53 in that period, down by almost $10 from its high for the year, but it has since nearly completely rebounded.
Comcast’s results are a good example of how the cable business can be a disaster on one hand, but also a powerful source of revenue. While millennials and other customers are busy cutting the cord and ditching their Comcast cable for streaming services or other alternatives, the company still provides Internet service for a huge chunk of the nation, and streaming services eat up cable bandwidth like candy.
So a big part of the growth in the company’s cable unit came from Internet access growth: Comcast added more than 300,000 high-speed data customers in the third quarter, which was the company’s best performance in six years. The company has also been experimenting with a number of new pay-per-use features such as a monthly fee for boosting a user’s data, which is underway in Nashville, Atlanta and Florida.
On top of that, Comcast has been having some success with its X1 technology, an Internet-based streaming service it hopes will compete with Hulu. That represented about 60% of the company’s video connections for the quarter. And it also introduced a “slim bundle” called Stream that costs just $15 a month for a stripped-down cable package of HBO and several broadcast networks.
Is the cable business still in decline? Of course it is—at least the broadcasting side certainly is. But Comcast is a beast of many parts, and even as it suffers from that decline, it is also equipped to benefit from it to some extent. And its movies and TV shows represent a hedge against some of the effects of that secular disruption (as do its investments in new media entities such as BuzzFeed and Vox). So probably best not to count the company out just yet.
You can follow Mathew Ingram on Twitter at @mathewi, and read all of his posts here or via his RSS feed. And please subscribe to Data Sheet, Fortune’s daily newsletter on the business of technology.
