Verizon ( VZ) emphasized its gains in growth markets, and investors obligingly stopped gawking at the core declines.The nation's largest telco reported solid third-quarter earnings and managed to keep its wireless winning streak alive with another record-high number of net new subscribers. The continued wireless momentum and big broadband gains successfully offset a sharp drop in total phone lines. For the quarter ended last month, Verizon Wireless -- co-owned by Verizon and Vodafone ( VOD) -- added 1.9 million net new users and kept its monthly defection rate, or churn, at 1.3%. And thanks to cheap digital subscriber line, or DSL, offerings, Verizon added 389,000 broadband customers. All the fuss over growth provided a nice distraction from the accelerated shrinkage of Verizon's core phone business. Total phone lines dropped 6.2% from a year ago, a somewhat alarming pickup in the pace of declines. Lines had dropped 5.5% in the prior quarter. Verizon executives on a conference call with analysts Thursday tried to put the line losses in perspective, stressing that observers should consider the bigger picture. The upshot: Verizon is in the midst of a huge transition. The phone giant is investing in bold new efforts to help offset the erosion of its core calling business. But Wall Street is familiar with that line and hasn't shown much patience for costly reinvention stories. Verizon shares hit a three-year low earlier this month on worries that the big Bell was spending its way into a massive hole. But the company's stock caught a little slack Thursday, as pessimists took a little breather. All in all, "it was a net modest positive," says a hedge fund manager with no positions. "The sky is not falling. The problems are evident but the company is operating through them."