ePlus inc. (NASDAQ:PLUS) Q1 2021 Earnings Conference Call - Final Transcript
Aug 05, 2020 • 04:30 pm ET
future quarters. It is consistent with our history of achieving industry-leading gross margins as compared to our peers.
Taking a closer look at first quarter results, while Technology segment net sales declined 7.4% to $341.2 million, our adjusted gross billings held stable at $546 million. This conversion rate, several hundred basis points higher than usual, was based on a significant increase in demand for third-party maintenance, software assurance, and subscriptions in the first quarter.
Turning to our financing business. Revenue grew 8% over last year, reflecting the benefit of post-contract earnings as we extended the term of some lease agreements. We think our financing activities will continue to increase in importance as leasing is a great alternative, which facilitates customers ability to upgrade and secure their IT infrastructure, while minimizing upfront cash requirements.
There is no question that COVID-19 has been challenging to us, our customers, and our business partners. However, it has also solidified relationships with many of our customers by showcasing our ability to nimbly execute complex projects in a timely manner. Many customers are trying to improve remote workforce enablement with collaboration capabilities while providing secure remote access for their data being access from home. Some are dealing with data center capacity issues due to the influx of remote workers are also looking for ways to contain costs while looking at leverage the full benefits of the cloud.
In some cases, they have no budget allocated for the solutions they need now due to the pandemic.
Let me give you a few examples of how ePlus has assisted our customers navigate this new environment. One customer's current infrastructure could not support the workload generated by their employees working from home. They had to improve their network capacity and upgrade their security posture and protocols needed for the move to remote work.
This was an unbudgeted expense that needed to be done in a timely fashion. We were able to leverage the power of our two business segments, by providing the technology and services they needed along with the flexible instalment purchase of Agreement provided by our finance team. This solved the customers budget constraint and they were able to get the technology they needed to address their critical business needs.
Another customer had multiple disparate systems running in parallel and wanted to consolidate all communications platforms under a single solution. While this goal had been in their plans, COVID-19 created additional challenges that required accelerating their timeline. They wanted to leverage the resiliency and flexibility of the cloud, while maintaining control and accessibility of an on-premise solution and choose a multi-year commitment through a cloud-based collaboration solution. This solution allow their IT team to manage this cloud-based solution remotely and not be on site, while providing their users access to an enterprise level collaboration platform from home.
In summary, these solutions provided an enhanced user experience, better network capacity and security and allowed all employees to seamlessly work across the company. Also, we are helping our customers