Walt Disney (DIS) had an odd earnings result last week. The company reported revenues fell 2.7% year-over-year to $13.14 billion and EPS of $1.10 was a 6 cent miss. EPS misses for a mature mega-cap company like DIS should mean the stock will get hammered—and the initial response in after-hours trading was a rampant sell-off. Yet shares reversed on Friday and ended up nearly 3%. What’s going on here?

The story is interesting, but before we answer that question let’s look at the details, because they are even more worrying. One of DIS’s biggest revenue drivers is ESPN. Yet the sports networks failed to deliver. Media networks revenue fell 3% year-over-year and operating income in the segment fell 8% year-over-year. Disney admitted the channels were hit by a decline in subscribers as cord-cutting continues to impact the company’s business.

But remember that stocks are forward-looking and not backward looking. So Disney was right to emphasize the future of ESPN on its earnings call. The future for the sports network clearly is on the internet, and Disney is addressing this. CEO Robert Iger had this to say:

“In addition to our deals with Sony and Sling, we’ve recently closed deals with Hulu as well as AT&T Direct, which features ESPN among the 100 channels offered on the new DirecTV Now service. We believe these new services will ultimately move more Millennials into the pay-TV universe, and we’re currently in negotiations with other distributors to further expand our presence on these new platforms. Our recent investment in BAMTech is also targeted at expanding our reach, and we’re excited about rolling out our first ESPN-branded content direct to consumers via this platform in 2017.”

In short, Iger is looking at expanding the options consumers have to get ESPN, and their recent acquisition of BAMTech seems like the first step in making ESPN available online via streaming options at a large scale. Such a move would effectively remove ESPN from the declining cable t.v. world and, as Iger says later, make it available to more people:

“We have taken a more bullish position on the future of ESPN’s sub base. We think that while we were candid a year ago on sub losses, we believe that, to some extent, the causes of those losses have abated, notably the migration to smaller packages. But we also believe that new entrance in the marketplace, particularly DMVDs – digital MVPDs, I should say, are going to offer ESPN opportunities that they haven’t had before to reach more people, and in particular we think those offerings because of their pricing, the user interface, their mobile-friendly nature, are likely to cause more Millennials to either stay in the multi-channel ecosystem as subscribers or to enter it when they might not have in the past.”

Clearly, ESPN is not going to be on cable only in the future, so the past miss is not really a good reason to sell the stock.

Of course, that begs the question of whether Iger can be trusted. Management notoriously promises big things in the future and often underdelivers. Analysts now need to learn more about Disney’s plans to stream ESPN in the future, map out the revenue potential of these plans, and look at other case studies to see how successful online streaming as a business can be. Remember the disaster newspapers had when going online—that is a real risk with television today. The question analysts need to answer is whether legacy media companies have learned from the newspaper fiasco and won’t repeat history with cable t.v.