FireEye ( FEYE ) delivered a lofty promise Tuesday — profitability in 2017. The No. 7 cybersecurity firm (by market cap), FireEye hasn’t been in the black yet. But FireEye’s transition to a software-as-a-service subscription model could de-emphasize the competitively pressured appliance market, a William Blair analyst said Wednesday — a day after FireEye unveiled its plans and gave its profit forecast at its annual analyst day. FireEye stock was up 1% in afternoon trading on the stock market today , after earlier rising 10%. Shares fell 4.6% Tuesday despite the guidance. On Wednesday, Piper Jaffray analyst Andrew Nowinski upgraded FireEye stock to overweight from neutral, and was among at least four analysts to boost their price targets. “We believe FireEye can successfully transition to a (SaaS) model,” Nowinski wrote in a research report. “We believe FireEye is well-positioned to execute this transition due to the company’s best-in-class intelligence gathering capabilities. “No other vendor can capture a complete intelligence package like FireEye, since they lack the Mandiant and iSight capabilities.” By 2020, subscriptions and SaaS offerings will comprise 75% of total billings, FireEye executives promised Tuesday. On that path to profitability, FireEye curbed its 2016 loss expectations to $1.20-$1.27 per share, ex items. The company also slashed its capital 2016 expenditures expectations by $15 million to $35 million. Long term, FireEye expects to boost its international sales from 30% of total revenue in 2015 to nearly 50% by leveraging third-party distributors like Westcon, a key distributor that helped scale Palo Alto Networks ’ ( PANW ) international revenue, Nowinski wrote. Shifting From Core Appliance As it transitions to the “more defensible” subscription and SaaS model, FireEye is de-emphasizing its appliance offerings. Combined, FireEye’s four core appliance products comprise only 27% of billings, William Blair analyst Jonathan Ho wrote in a report. “Instead, the company sees growth in new business lines such as FireEye-as-a-Service, Email Threat Prevention, Threat Analytics Platform and Mobile Threat Protection, which appear more defensible than the core business,” he wrote. Guidance suggests that FireEye can achieve profitability while still investing in these growth areas, Ho said, retaining his outperform rating on FireEye stock. But Dougherty analyst Catharine Trebnick questioned whether FireEye can deliver on its subscription and SaaS goals given tough comparisons. In 2015, subscription billings jumped 42% year over year. “This was largely driven by unattached subscription growth of 64% year over year, while attached grew at 29% year over year,” she wrote in a report. For 2016, FireEye guided to 70% unattached subscription growth. Excluding the iSight and Invotas acquisitions, however, that signals only 26% organic growth. “The company needs products from this section to be the leading edge of growth,” she wrote. “Looking beyond 2016, the company’s to-be-released advancements may be able to accelerate this figure.” Trebnick retained her neutral rating “until we can observe meaningful progress trickle down into the field.” Turning On The Cash Spigot FireEye expects its first profitable quarter in Q4 2017, and its first profitable year in 2018. Pacific Crest analyst Rob Owens, however, questioned the logic of transitioning both profit and product-mix simultaneously. “We believe a simultaneous mix shift and profitability initiative create incremental risk, particularly given recent execution,” he wrote in a report. But, he noted, the product shift should give more visibility into FireEye’s revenue stream. In 2015, FireEye-as-a-Service delivered triple-digit customer growth, reaching a $100-million run rate. FireEye now has 363 FaaS customers, up 101% and comprising 8% of the total 4,400 customers, FBN analyst Shebly Seyrafi wrote in a report. He sees “ample headroom for further penetration” in the FaaS market. About half of FireEye’s customers use multiple families of products, Trebnick noted separately. Seyrafi boosted his price target on FireEye stock to 25 from 18 and retained his outperform rating.