Yeah, inflation is everywhere. So much for Americans heading out to the basketball game at Madison Square Garden (Nasdaq: MSG), right? And even if they can afford a night out, they probably won't cough up the cash for a $10 beer, will they?

No and no. Not only did MSG beat analysts' expectation in its first-quarter earnings report, but it did so based on the strength of its sports division revenue growth.

Last time around, Madison Square Garden didn't meet analysts' expectations and, like its balding sports buddy World Wresting Entertainment (NYSE: WWE), saw some weakness in its sporting event and production revenue. This time at MSG, overall revenue increased by 7.8%, and EPS increased by 9.8%, to $0.25.

Revenue for MSG's sports segment grew by 10.6% for the quarter, although the group actually delivered flat operating profit, sitting around breakeven, on increased player costs (probably thanks to the Knicks' additions of Carmelo Anthony and Amar'e Stoudemire). MSG Media reported a 5.8% gain in revenue with particular strength in advertising sales, and MSG Entertainment revenue grew by 3.2%.

Hey, did I mention that Knicks ticket prices will be up an average 49% next season, with Rangers ticket prices rising by 23%? Even though this extra revenue is targeted to pay for the Garden's renovation project, it shows the company's optimism that it will continue to grow in spite of what can be called an irrational market environment.

As a Pittsburgh girl, I know that no matter what the economy is like, Americans love to watch sports. They might complain about crazy beer and nacho prices, but they're still going to go to the game and drink up. Even though the Knicks and Rangers were knocked out in the playoffs, the company did make some extra cash during the playoff run.

Madison Square Garden has certainly delivered since its spin-off from Cablevision (NYSE: CVC): The stock is up more than 30% in the last year. I can see why the Fool owns shares since the company has a lot of potential, especially with the renovation project in progress. With fans paying up for next season's tickets, those teams are going to have to deliver, which should be a nice windfall for MSG investors.

Fool contributor Colleen Paulson does not hold positions in any of the stocks mentioned in this article. The Fool owns shares of Madison Square Garden. For more investing insight, you can always give the Fool's newsletters a try via the 30-day free trial. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.