Unfortunately, local restrictions remain in force and we were only operating at 30% of capacity to start the quarter.
Our estimate today is that we are operating approximately at 75% to 80% of productivity.
Benchmark began its journey as a medical device manufacturer more than 40 years ago and has maintained partnerships with some of the largest medical technology companies in the world.
Even considering the challenging environment, we achieved revenue of $515 million in the first quarter, which were supported by strong demand in our Semi-Cap, Medical, and A&D sectors.
Our gross margins for the quarter were 8.4% and non-GAAP earnings per share were $0.22.
And as a result, we estimate that our China factory inefficiencies impacted our global earnings per share by approximately $0.08.
Our cash conversion cycle for the quarter was 81 days.
We used $3 million in cash flow from operations and free cash flow was a negative $15 million as a result of $13 million spent on capex.
Originally we expected to spend approximately $50 million in capital expenditures in fiscal year 2020.
Medical revenues for the first quarter increased 15% sequentially and were up 14% year-over-year from volume increases across several customers for new and existing programs.
Semi-Cap revenues were up 2% in the first quarter and up 25% year-over-year where increase in demand across the majority of our Semi-Cap customers along with the ramp of new customer to our portfolio.
A&D revenues for the first quarter increased 13% sequentially and were up 15% year-over-year from new program ramps for defense satellite, munition and security.
We did receive signals late in the quarter of demand decreases in Commercial Aerospace segment which is less than 30% of our A&D sector revenues.
Industrial revenues for the first quarter decreased 4% sequentially and 12% year-over-year.
Overall the higher value market represented 82% of our first quarter revenue.
Turning now to our traditional market; computing was down 71% year-over-year from the completion of the legacy computing contract in 2019 and 18% sequentially quarter-over-quarter from lower data center storage and commercial printing product demand.
Telco was down 15% sequentially and down 37% year-over-year from lower demand for infrastructure build out related products.
Our traditional markets represented 18% of first quarter revenues.
Our top 10 customers represented 42% of sales for the first quarter.
Our GAAP earnings per share for the quarter was $0.10 and our GAAP results included $2.9 million of restructuring and other non-recurring costs in Q1.
These costs included $1.9 million of cost-related to our previously announced site consolidation effort and other restructuring type activities around our network and $1 million for an impairment related to a building that is now being classified as held-for-sale.
Turning to slide 10 for our non-GAAP financial information for Q1, our non-GAAP -- our Q1 non-GAAP gross margin was 8.4% a 100-basis-point increase quarter-over-quarter and 30-basis-point year-over-year.
Our SG&A was $31.6 million, an increase of approximately $7 million sequentially.
Operating margin was 2.3%, a decrease from 2.6% in Q4 due to the lower than expected revenue and inefficiencies related to COVID-19.
In Q1, 2020, our non-GAAP effective tax rate was 19%, which was lower than expected for the quarter due to the distribution of income across our network.
We expect that for Q2, our non-GAAP effective tax rate will continue to be in the range of 20% to 22%, again because of the distribution of income around our global network.
Non-GAAP earnings per share was $0.22 for the quarter and ROIC was 7.1%.
Our CEO, the board and our senior executive team will take a temporary 10% salary cut, while the rest of the senior leaders in the company will take a 7% salary cut through Q3 2020.
Our cash balance was $412 million at March 31 with $223 million available in the U.S.
Our cash balances include $95 million of proceeds from borrowings under our revolving line of credit.
We do expect our net interest expense to increase by $500,000 in Q2.
Overall at the end of Q1 2020 we are in a positive net cash position of approximately $170 million.
Our accounts receivable balance was $318 million, a decrease of $6 million from December 31.
Contract assets were $160 million at March 31 and $161 million at December 31.
Payables were up $13 million quarter-over-quarter.
Inventory at March 31 was $338 million up $23 million quarter-over-quarter due to mix changes from customers late in the quarter and bringing in inventory to support long production cycles for product in our Semi-Cap and Medical sectors.
For Q1 2020, our cash conversion cycle was 81 which was within our expectations at the beginning of the quarter and was achieved even considering the challenging environment.
As discussed previously after the completion of the legacy computing contract in the third quarter of 2019, our cash conversion cycle will be between 78 and 83 days.
Turning to slide 13 for our capital allocation update, in Q1 we returned approximately $25 million to shareholders, this included $5.5 million as part of our recurring quarterly cash dividend, which we recently increased to $0.16 per share and announced on February 3, 2020.
We also repurchased approximately 724,000 shares or $19 million.
As of the end of March 2020, we had approximately $210 million available under the current share repurchase program after an increase approved by the Board in February 2020.
Because of the uncertain conditions related to COVID-19 we will not provide our usual detailed level next quarter guidance.
Approximately 20% of our industrial customers support the oil and gas industry and we expect demand to be softer throughout the balance of the year.
Our A&D sector is comprised of approximately 70% defense related product and 30% aerospace.
Benchmark Secure Technology has been a Raytheon partner for almost 20 years and we look forward to supporting this expanding strategic relationship across Benchmark.
Also given our demand outlook and new program ramp from wins in the past 24 months, we need to maintain critical resource capability, which Roop mentioned as a top priority.
We also expect gross margins will recover to the 9% range in the second half of 2020.
As a result of some of the actions, we expect that SG&A will be reduced approximately 8% in Q2.

Summary:
Even considering the challenging environment, we achieved revenue of $515 million in the first quarter, which were supported by strong demand in our Semi-Cap, Medical, and A&D sectors.
Our gross margins for the quarter were 8.4% and non-GAAP earnings per share were $0.22.
Our GAAP earnings per share for the quarter was $0.10 and our GAAP results included $2.9 million of restructuring and other non-recurring costs in Q1.
Non-GAAP earnings per share was $0.22 for the quarter and ROIC was 7.1%.
Because of the uncertain conditions related to COVID-19 we will not provide our usual detailed level next quarter guidance.