Indeed, and as I understand it, there's a mechanism in a modern transmission that disables the torque converter when cruising, further improving efficiency.

Over the course of my life, I've noticed a remarkable improvement in the behavior of automatic transmissions, going from "jerky" to "smooth" for lack of better terms. While overseas last year, I drove a large Mercedes van that even sensed when I was descending a hill, and downshifted the way I would have done it in a stick shift car.