APRIL 30, 2020

iShares Trust

Table of Contents

Market Overview

iShares Trust

Global Market Overview

Global equity markets posted a negative return during the 12 months ended April 30, 2020 (“reporting period”). The MSCI ACWI, a broad global equity index that includes both developed and emerging markets, returned -4.96% in U.S. dollar terms for the reporting period.

The coronavirus pandemic was the defining event of the reporting period, dividing it into two distinct parts. Prior to the outbreak, global equities posted solid returns, supported by slowing but resilient growth and accommodative monetary policy from major central banks. Equity markets ended 2019 on a positive note, as a trade agreement between the U.S. and China helped alleviate one of the world economy’s most significant risks.

However, the emergence and spread of the coronavirus upended global equity markets in late 2019 and early 2020. The outbreak began in China and quickly spread to other countries around the globe, leading affected countries to limit economic activity in an attempt to contain it. As the extent of the outbreak became apparent in February 2020, and restrictions on travel and work disrupted the economies of countries worldwide, global equity prices declined sharply. Market volatility continued throughout March 2020, as investors struggled to project the length of the disruption and its ultimate economic impact. In the midst of this volatile environment, decreasing demand and a dispute over oil production between Russia and Saudi Arabia led to a sudden decline in oil prices, further dampening market sentiment. In April 2020, however, optimism around plans in some countries to begin easing lockdown restrictions and new potential coronavirus treatments led global stocks to recover some of their losses.

In the U.S., as state and local governments issued shelter-in-place orders and restrictions on public gatherings and nonessential work, whole portions of the U.S. economy shut down. Travel, leisure, and industries such as restaurants and nonessential retail, were closed in many areas of the country, leading to mass layoffs. Unemployment, which was hovering near a 50-year low for much of the reporting period, increased dramatically as more than 30 million workers filed unemployment claims in the last six weeks of the reporting period.

In response to the crisis, the U.S. federal government enacted a U.S. $1.8 trillion stimulus program designed to stabilize affected industries, make loans to small businesses, and provide direct cash payments to individuals. An additional U.S. $484 billion of stimulus was added in April 2020. The U.S. Federal Reserve Bank (“Fed”), also responded to the crisis with two emergency interest rate reductions in March 2020 and a new bond-buying program that included U.S. Treasuries, corporate and municipal bonds, and asset-backed securities.

Europe was similarly affected by the coronavirus; Italy, Germany, France, Spain, and the U.K. were among the countries with the most confirmed cases. European stocks declined substantially as some countries issued lockdown orders to contain the virus’ spread. To mitigate the economic impact of this disruption, many countries individually implemented fiscal stimulus plans designed to protect affected businesses and workers. The European Central Bank (“ECB”) also sought to steady markets with a €750 billion bond buying program and signaled openness to further stimulus.

Asia-Pacific and emerging market equities also declined significantly, despite some signs that the outbreak was beginning to slow down. The Chinese economy struggled initially due to widespread business and factory closures, then later from a lack of demand, as other affected countries decreased their imports of Chinese goods and cancelled existing orders.

Investment Objective

The iShares Core Dividend Growth ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. equities with a history of consistently growing dividends, as represented by the Morningstar^® U.S. Dividend Growth Index^SM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

Expense Example

Portfolio Management Commentary

Stocks of firms with a history of consistently growing dividends declined slightly amid significant market turmoil during the reporting period. Concerns over the coronavirus pandemic weighed on markets, but investors perceived dividend growth stocks as relatively less affected. Stay-at-home orders and other efforts to contain the virus made a substantial negative impact on markets, anticipated corporate profits declined, and some firms reduced or suspended dividends.

The financials sector was the largest detractor from the Index’s return. Banks detracted the most as rising defaults driven by the coronavirus crisis weighed on bank profits. Banks built reserves in anticipation of additional defaults, as virus lockdowns affected many businesses that borrow from banks. Large banks continued to pay dividends, despite mounting political pressure to suspend them. Insurance stocks also declined, as anticipated earnings decreased due to lower bond yields, less economic activity, and coronavirus-related losses.

The industrials sector struggled amid expectations of lower earnings, further detracting from the Index’s performance. The capital goods industry drove the decline as business investment contracted for three consecutive quarters. Aerospace and defense companies were substantial detractors, as decreased travel reduced demand for aircraft, and some firms suspended dividends. The energy sector also declined, due primarily to significantly lower oil prices.

On the upside, healthcare stocks were strong contributors to the Index’s return. Healthcare companies with solid dividends were attractive to stock investors seeking stability after coronavirus concerns increased market volatility. Pharmaceuticals, biotechnology, and life sciences companies made the most significant contributions within the healthcare sector, as firms developed potential treatments for the virus. Healthcare equipment and services firms also made notable contributions, in part due to higher than expected earnings for managed care providers. The information technology sector was also a notable contributor to the Index’s performance. Software and services firms advanced, driven by the continued shift toward subscription-based cloud software.

Portfolio Information

Investment Objective

The iShares Core High Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Morningstar^® Dividend Yield Focus Index^SM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

Expense Example

Portfolio Management Commentary

Stocks with histories of high dividend yields declined notably during the reporting period. The coronavirus crisis reduced expected earnings and stock prices, but many companies responded by suspending repurchases rather than decreasing dividends. Dividend stocks also benefited from lower bond yields, which makes dividend-yielding stocks relatively more attractive to income-seeking investors. However, some investors remained cautious about high dividend yield stocks due to increased concerns about their long-term financial outlook.

The energy sector was the largest detractor from the Index’s return, as oil prices declined due to a production dispute between Saudi Arabia and Russia on the supply side and coronavirus-related restrictions on the demand side. As the prices of oil company stocks decreased, their dividend yields increased substantially, leading to concerns about their ability to continue the current levels of dividend payouts. However, large oil and gas companies maintained their dividends in this unfavorable environment, even as expected earnings decreased. Investors were also concerned that high dividend-paying oil and gas companies focused too much on current revenues, rather than adapting to increased demand for renewable energy.

The financials sector detracted significantly from the Index’s performance, led by banks as the decline in banks’ stock prices, combined with the maintenance of dividends, led to a meaningful increase in dividend yields. However, political pressure and possible defaults by energy firms led to concern over the future of bank dividends. The communication services sector also detracted from the Index’s return, as the expectation of a coming recession made future dividend reductions appear more likely.

On the upside, healthcare stocks contributed notably to the Index’s return, led by the pharmaceuticals industry. Solid demand supported continued cash flows for dividends, while the political environment improved somewhat as the presidential race narrowed to two candidates.

Portfolio Information

Investment Objective

The iShares International Select Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying equities in non-U.S. developed markets, as represented by the Dow Jones EPAC Select Dividend Index^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

Expense Example

Portfolio Management Commentary

International dividend stocks declined sharply during the reporting period, as a dramatic economic downturn weighed on global equities and drove widespread dividend reductions and suspensions. The decrease in economic activity caused by the coronavirus pandemic, which drove expectations of a global recession, weighed on dividend stocks. Additionally, reduced revenues and political factors put firms under pressure to decrease or eliminate dividends, which substantially lowered expected income for investors. Financials stocks retreated across multiple markets, weighed down by exposure to all areas of the global economy, as well as increased demand for U.S. dollars and concerns about potential loan defaults.

Australian stocks were the primary detractors from the Index’s return, as the pandemic’s impact on the economy, which is sensitive to economic conditions in China, led to recessionary forecasts. Australia experienced significant job losses and weakening business and consumer sentiment. The Australian dollar, which often moves in tandem with the Chinese yuan, weakened against the U.S. dollar. Bank stocks, already under pressure entering 2020 due to a series of scandals and tightening net interest margins, declined sharply amid a reduction in loans and reduced or suspended dividend payments.

French and German equities detracted substantially from the Index’s return, as Europe’s two largest economies faced their deepest downturns since World War II. Bank stocks were the principal source of weakness, as banks, heeding the recommendation of the ECB, cancelled or suspended dividends toward the end of the reporting period. With earnings already weak prior to the pandemic, the potential for loan defaults weighed on European bank stocks, despite stimulus efforts by the ECB and other central banks. More stringent E.U. accounting standards, which require earlier disclosures of loan losses, further weighed on both countries’ bank stocks.

The stocks of dividend-paying companies based in the U.K. also declined considerably. The energy sector detracted the most from the Index’s performance, as supply and demand shocks drove the price of oil to a 21-year low amid a price war and a coronavirus-induced decline in demand. Large oil firms issued bonds to raise cash, postponed projects, and reduced spending, in part to maintain their dividend payments. Nonetheless, some oil companies reduced their payouts.

Portfolio Information

Investment Objective

The iShares Select Dividend ETF (the “Fund”) seeks to track the investment results of an index composed of relatively high dividend paying U.S. equities, as represented by the Dow Jones U.S. Select Dividend Index^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

Expense Example

Portfolio Management Commentary

Equities that have historically paid relatively high dividends declined for the reporting period, as the coronavirus pandemic and associated lockdowns weighed on equity markets. Early reports also indicated that corporate earnings decreased considerably in the first quarter of 2020. In this environment, many firms reduced or suspended their dividends.

The consumer discretionary sector was the largest detractor from the Index’s return, and the automobiles industry was the leading source of weakness. Automobile manufacturers suspended their dividends, and unions opposed plans to reopen factories early due to concerns over the coronavirus. Furthermore, analysts anticipated a substantial decline in demand for automobiles, as consumers delayed purchases. The retail industry was also negatively impacted, as sales at clothing stores decreased significantly amid lockdowns. Some department stores and apparel retail firms suspended dividends in response to the deteriorating retail environment.

The financials sector detracted significantly from the Index’s performance, driven by declines among bank and insurance stocks. Many regional banks continued making dividend payouts at previous levels, leading to high dividend yields after stock prices decreased. However, political pressure to reduce bank dividends increased. Investors were also concerned that bad loans to the energy sector could lead regional banks to decrease their dividends. Additionally, uncertainty regarding possible losses related to the coronavirus pandemic negatively affected the insurance industry.

The energy sector was another significant detractor from the Index’s return due to a combination of decreased demand from locked-down consumers and a production dispute between Russia and Saudi Arabia. Some oil producers preserved dividends, even as lower stock prices increased dividend yields. However, other firms in the oil, gas, and consumable fuels industry significantly reduced dividends. The materials sector also detracted substantially, as lower oil prices negatively impacted the chemicals industry. The shutdown of industrial plants also reduced demand for some types of chemicals.

Portfolio Information

Investment Objective

The iShares U.S. Dividend and Buyback ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. stocks with a history of dividend payments and/or share buybacks, as represented by the Morningstar^® US Dividend and Buyback Index^SM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

Expense Example

Portfolio Management Commentary

Stocks with histories of paying dividends or making buybacks posted a negative return for the reporting period, as the coronavirus crisis negatively affected markets. Before the pandemic, stock buybacks were a significant consideration for investors. However, many firms suspended their stock buybacks after the spread of the virus due to decreased earnings and increased political pressure. Some companies went further and reduced or eliminated dividends. At the same time, market volatility and lower bond yields increased investor interest in dividend-paying stocks.

The financials sector was the largest detractor from the Index’s return, particularly the banking industry. Many banks announced substantial stock buybacks and dividend increases in 2019, but some suspended the buybacks in response to the coronavirus crisis. However, banks mostly maintained their dividends despite mounting criticism from policymakers. Bank earnings also decreased significantly in the first quarter of 2020, and banks increased their reserves against future loan losses.

The industrials sector also detracted meaningfully, led by the capital goods industry. Capital goods orders started declining even before the coronavirus pandemic diminished the outlook for business investment. Furthermore, some industrials companies eliminated dividends and buybacks, which reduced demand for their stocks. The energy sector also detracted from the Index’s performance, in large part due to a significant decline in oil prices. Some energy firms stopped buybacks and preserved dividends, but others reduced dividends substantially.

On the upside, the healthcare and information technology sectors contributed to the Index’s return. The pharmaceuticals, biotechnology, and life sciences industry benefited from optimism about research to develop vaccines and treatments for the coronavirus. Companies in the information technology sector benefited from the emphasis on social distancing, as consumers turned to technology to replace face-to-face interactions. The earnings growth, cash reserves, and low debt in both the healthcare and information technology sectors supported continued dividends.

Portfolio Information

About Fund Performance

Past performance is no guarantee of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time, and may continue to affect adversely the value and liquidity of the fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.

Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. The price used to calculate market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Since shares of a fund may not trade in the secondary market until after the fund’s inception, for the period from inception to the first day of secondary market trading in shares of the fund, the NAV of the fund is used as a proxy for the Market Price to calculate market returns. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.

An index is a statistical composite that tracks a specified financial market or sector. Unlike a fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a fund. These expenses negatively impact fund performance. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower.

Shareholder Expenses

As a shareholder of your Fund, you incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares and (2) ongoing costs, including management fees and other fund expenses. The expense example, which is based on an investment of $1,000 invested at the beginning of the period (or from the commencement of operations if less than 6 months) and held through the end of the period, is intended to help you understand your ongoing costs (in dollars and cents) of investing in your Fund and to compare these costs with the ongoing costs of investing in other funds.

Actual Expenses — The table provides information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. To estimate the expenses that you paid on your account over the period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”

Hypothetical Example for Comparison Purposes — The table also provides information about hypothetical account values and hypothetical expenses based on your Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.