No, they are annexing things that bring revenue as their tax base. Generally commercial and industrial development brings in more money than it takes to provide services. Annexing residential is generally not attractive to city planners since residents usually use more in terms of services than pay in taxes, especially if they are on the periphery of the town.
Cities without Suburbs describes the strategy in detail http://www.amazon.com/Cities-without-Suburbs-Woodrow-Special/dp/1930365144