FireEye is scheduled to release its next earnings report on Thursday, and it seems investors aren’t buying Oppenheimer’s optimism. The cyber-security firm is still expected to post losses for this year and next, but Oppenheimer analysts maintain that their checks suggest the first quarter was a solid one.

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FireEye checks suggest solid Q1

In a report dated May 2, analysts Shaul Eyal and Tanner Hoban reiterated their Outperform rating and 12- to 18-month price target of $35 per share for FireEye. Their channel checks of 20 value-add resellers or partners suggest that the company’s first quarter results will at least be in line with expectations and the mid-point of its revenue guidance, which is $172 million, representing a year over year increase of 37%. They said most of the resellers they spoke to said they were at the very least meeting internal quotas. Partially as a result of the recent widely publicized cyber-security breaches.

They also note that recent results from Fortinet, Barracuda Networks, Proofpoint and Check Point Software indicate that cyber-security spending among businesses is still strong.

FireEye responds to the call

The Oppenheimer team also found that FireEye is gradually improving its results in Europe, the Middle East, and Africa and the Asia Pacific Region. Together, the two regions accounted for more than 25% of the company’s total revenue in the fourth quarter. They listed the main drivers of this improvement as the recent sales realignment and economic recovery in many European Union countries.

They also believe FireEye is being responsive to the rapidly changing requirements of the industry, like debuting its Mandiant offering for law firms after the Panama Papers breach. The cyber-security firm is also working on some products to automate security and make it more efficient. Additionally, it’s working on other products to help businesses reduce the need for IT security professionals, who are in demand right now.

The Oppenheimer team expects FireEye to post first quarter losses of 50 cents per share on $172 million in revenue. The firm beat estimates for the fourth quarter.

Shares of FireEye declined 1.67% to $17.06 during regular trading hours on Monday.