Cord-cutting in the U.S. pay TV market is not only real but accelerating rapidly. In 2016, the industry lost approximately 1.5 million subscribers, compared with just over 1 million in 2015. It would be logical, therefore, if the major pay TV providers were suffering as a result, seeing declining revenues and squeezed margins.

However, those providers as a group continue to see relatively healthy growth in television revenue and overall consumer income year on year. In 2016, TV revenue for distributors with more than a million subscribers increased by 2.9% over 2015. Total residential revenues (including broadband and voice services) grew by 2%, which means that TV income grew faster than overall revenue.

How could this be, given the 1.5 million lost subscribers? The answer lies in the fact that the amount paid per month by the typical U.S. pay TV subscriber continues to increase at a good clip. Though subs may be declining at a rate of 1.5% or so, average revenue per TV subscriber is growing by 2%-6% for those providers that report this number.

sources: Company Reporting, jackdaw research Analysis

As cable-network owners raise their rates, often as part of annual increases baked into contracts, pay TV providers pass those on to consumers in a number of ways. Some parts of the cable bill have risen faster than per-channel fees.

Equipment rentals for set-top boxes and DVRs are one of the fastest-growing categories, not only due to price increases but also factoring in more boxes per household.

Still, premium channels like HBO and Starz are driving revenue growth faster than the base package; they’re among the few channels showing subscriber growth in a generally down market. And paid VOD also has increased in recent years as providers have expanded their libraries and improved the interfaces used to access them.

sources: Company Reporting, jackdaw research Analysis

Despite revenue growth, though, profit margins for pay TV providers haven’t increased, and in a number of cases, they’ve been squeezed. That’s not surprising given both the growth in programming costs, which has outpaced pay TV price increases, and the increasing costs of acquiring new subscribers.

Big profits on broadband and voice services have helped some providers stem the margin crunch a little, but that can’t last, particularly as the pace of those opting out speeds up. In addition to cord-cutting, we’re seeing cord-shaving by customers moving from traditional big packages to smaller bundles.

It’s only a matter of time before price increases can no longer offset declining subscribers and the move to skinny bundles — and in fact becomes counterproductive to retaining customers. At that point, TV revenues are likely to decline more rapidly, and only those companies with strong broadband businesses or direct stakes in content are likely to be able to maintain overall revenue growth.

Jan Dawson is the founder and chief analyst at Jackdaw Research, an advisory firm for the consumer technology market.