iShares Trust

·  iShares Environmental Infrastructure and Industrials ETF | EFRA | NASDAQ

·  iShares Global 100 ETF | IOO | NYSE Arca

·  iShares Global Infrastructure ETF | IGF | NASDAQ

·  iShares Global Timber & Forestry ETF | WOOD | NASDAQ

Table of Contents

Market Overview

iShares Trust

Global Market Overview

Global equity markets declined during the 12 months ended March 31, 2023 (“reporting period”). The MSCI ACWI, a broad global equity index that includes both developed and emerging markets, returned -7.44% in U.S. dollar terms for the reporting period. In the first half of the reporting period, concerns about the state of the global economy in the face of high inflation and rapidly rising interest rates drove stocks sharply lower. However, stock prices recovered somewhat in the reporting period’s second half, as economic growth proved resilient despite its slower pace.

Inflation was a significant factor in equity markets, and while its impact varied by country, most major economies experienced substantial inflation during the reporting period. This drove a wave of monetary tightening by most of the world’s central banks, which sent interest rates and borrowing costs sharply higher. The U.S. Federal Reserve (“Fed”) raised interest rates eight times, driving an increase in the value of the U.S. dollar relative to most other currencies. Commodities prices were volatile, and as the reporting period began, disruptions in the wake of Russia’s invasion of Ukraine meant high prices for energy commodities and some foods. While oil, gas, and most other commodities declined as markets adjusted to the war’s disruption, elevated prices exacerbated inflationary pressure.

The U.S. economy recovered from a decline in the first half of 2022 to post modest growth in the third and fourth quarters of 2022. Consumers continued to power the economy with growing spending, despite higher prices for many consumer goods and services. The strong labor market supported spending as unemployment remained very low, at one point dropping to the lowest recorded level since 1969. Furthermore, the labor force participation rate—which measures the total proportion of employed persons of working age—rose, indicating that more people were being drawn into the labor force. Amid tightening labor supply, wages rose significantly, with the largest gains at the lower end of the wage spectrum.

In addition to its interest rate increases, the Fed also started to reduce the size of its balance sheet by reducing the store of U.S. Treasuries it had accumulated to stabilize markets in the early phases of the coronavirus pandemic. While the Fed indicated that more tightening could be needed to achieve its long-term inflation goal, it sounded a more cautious note about the potential for further interest rate increases near the end of the reporting period.

European stocks outpaced most other regions of the globe, advancing modestly for the reporting period despite slowing economic growth. European stocks benefited from a solid recovery following the early phases of the war in Ukraine. While the conflict disrupted critical natural gas supplies, new sources were secured and prices began to decline, while a warm winter helped moderate consumption. The European Central Bank (“ECB”) responded to the highest inflation since the introduction of the euro by raising interest rates six times.

While inflation was somewhat more moderate in the Asia-Pacific region, stocks there declined amid higher interest rates and disruption from coronavirus-related lockdowns in China. However, China relaxed its strict anti-coronavirus protocols in December 2022, boosting analysts’ expectations for future growth in the region. Emerging market stocks declined substantially, pressured by slowing economic growth and a stronger U.S. dollar. The Fed’s interest rate increases weighed on emerging market equities by making U.S. assets relatively more attractive.

Investment Objective

The iShares Environmental Infrastructure and Industrials ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. companies that provide infrastructure and industrials solutions aiming to support energy efficiency and emissions mitigation, pollution reduction or land and resource optimization, as represented by the FTSE Green Revenues Select Infrastructure and Industrials Index (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

For the fiscal period ended March 31, 2023, the Fund did not have six months of performance and therefore line graphs are not presented.

The inception date of the Fund was November 1, 2022. The first day of secondary market trading was November 3, 2022.

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

Portfolio Information

Investment Objective

The iShares Global 100 ETF (the “Fund”) seeks to track the investment results of an index composed of 100 large-capitalization global equities, as represented by the S&P Global 100^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)

Index performance through January 30, 2013 is calculated using currency exchange (FX) rates corresponding to 5:15 P.M. ET. Index performance beginning on January 31, 2013 is calculated using FX rates corresponding to World Market Reuters 4:00 P.M. London.

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

Portfolio Management Commentary

Amid significant inflation and sharply higher interest rates, large-capitalization global stocks declined significantly for the reporting period. Stocks from the U.S., which represented approximately 73% of the Index on average, detracted the most from the Index’s return.

In the U.S., the consumer discretionary sector was the leading source of weakness. While consumer spending continued to grow, rising inflation drove up costs for companies, and consumers increasingly sought bargains as higher prices eroded personal spending power. Individual savings rates declined, while credit card debt and interest rates rose, further pressuring consumers. A tight labor market amid historically low unemployment also meant higher labor costs for the sector.

Within the sector, the internet and direct marketing retail industry was the largest detractor from the Index’s performance. The sharp rise in e-commerce that boosted the industry early in the pandemic waned as more workers returned to the office and brick-and-mortar retailers gained market share. Overbuilding of warehouses during the online shopping surge created excess capacity, which weighed on industry cash flow. Slowing revenue growth from data cloud services also pressured the industry’s profitability, as business customers tried to reduce expenditures amid economic uncertainty.

The communication services sector also declined, as the rising interest rate environment negatively impacted the interactive media and services industry, particularly high-valuation stocks with growth prospects. Demand for online advertisements slowed during the reporting period as businesses cut back on marketing expenditures in a more challenging economic environment. Heightened competition also worked against large companies in the industry, which lost market share to new players.

Swiss stocks also declined, led by the pharmaceuticals industry in the healthcare sector. Diminished demand for diagnostics products related to COVID-19 weighed on the industry. The Japanese consumer discretionary sector was another notable detractor, as the automobiles industry faced investor concerns about the pace of entry into the electric vehicle market.

On the upside, French stocks contributed modestly to the Index’s return. Increased sales of luxury goods buoyed the textiles, apparel, and luxury goods industry in the consumer discretionary sector.

Portfolio Information

Investment Objective

The iShares Global Infrastructure ETF (the “Fund”) seeks to track the investment results of an index composed of developed market equities in the infrastructure industry, as represented by the S&P Global Infrastructure 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)

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

Portfolio Management Commentary

Global infrastructure stocks declined for the reporting period amid slowing economic growth, high inflation, and concerns about the impact of rising interest rates. Early in the reporting period, high food and oil prices in the wake of Russia’s invasion of Ukraine weighed on infrastructure companies. However, China’s easing of its stringent Covid-19 pandemic restrictions and moderating inflation in the second half of the reporting period eased pressure on global infrastructure stocks.

Companies in the U.S. detracted the most from the Index’s return, particularly in the utilities sector. Increased costs of fuel, supply chain disruptions, and elevated inflation drove higher utility rates for customers and negatively impacted the industry’s finances. Supply-chain constraints and weather extremes also compromised the ability to provide reliable power generation and distribution. In addition, utilities faced difficulties rebuilding natural gas stockpiles amid strong demand as power plants transitioned away from burning coal, while a drought in the western U.S. limited hydropower generation in that region. Renewable energy providers faced similar supply-chain, fuel, and labor challenges that drove costs higher.

In Canada, energy infrastructure stocks detracted from the Index’s performance. The oil and gas storage and transportation industry faced disruption and expenses related to a large spill on a key North American crude oil pipeline and ensuing regulatory limits on the pipeline’s shipments. Concerns and legal battles persisted about the viability of another pipeline running from Canada into Michigan. Meanwhile, earnings declined for pipeline operators as rising interest rates led to higher financing costs in the capital-intensive business.

Conversely, stocks of airport services firms in Mexico contributed to the Index’s return. Many North American companies, responding to supply-chain difficulties that surfaced during the pandemic, returned more of their production base closer to home. Increased travel tied to that trend benefited the industry’s stocks. Overall, air travel in Mexico returned to pre-pandemic levels, and passenger traffic rose in the first 11 months of 2022 compared with the same time frame in 2019. The increase, in part, reflected relaxed U.S. border restrictions with Mexico beginning in late 2021.

Portfolio Information

Investment Objective

The iShares Global Timber & Forestry ETF (the “Fund”) seeks to track the investment results of an index composed of global equities in or related to the timber and forestry industry, as represented by the S&P Global Timber & Forestry 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)

Past performance is not an indication of future results. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. See “About Fund Performance” for more information.

Expense Example

Portfolio Management Commentary

Global timber and forestry stocks declined during the reporting period as rising interest rates weakened construction for new housing, sending lumber prices down sharply. Aggressive efforts by the Fed to slow inflation by raising interest rates forced mortgage rates above 7% for the first time in over two decades. Higher financing costs to purchase a home drove many prospective buyers out of the market, weakening construction of new housing and lumber prices. Construction for new housing trended lower throughout the reporting period, including five successive months of declining housing starts through January 2023. Lumber prices dropped more than 60% during the reporting period to the lowest levels since June 2020. An index of homebuilder confidence dropped in the first nine months of the reporting period to the lowest levels in more than a decade before rebounding during the first three months of 2023.

U.S.-based specialized real estate investment trusts (“REITs”) engaged in logging and forest management detracted the most from the Index’s return. Rising interest rates, which increase REITs’ financing costs while slowing growth, broadly weighed on REITs. Timber REITs are highly sensitive to the price of timber and prevailing homebuilding conditions, and the housing market slowdown and decreased sales of wood products weakened financial performance for the timber industry. Consequently, lumber REITs paid fewer dividends to shareholders.

Swedish stocks, particularly in the paper and forest products sector, also detracted from performance. Lower prices for solid wood products, increased raw material costs, and higher distribution expenses lowered profits.

Canadian stocks also detracted from the Index’s performance, led by paper and forest products companies that produce wood materials such as lumber, plywood, pulp, and newsprint. The fall in lumber prices led to sharply lower sales and profits. Insect infestations, forest fires, and the low availability of wood fiber led the Canadian companies to curtail operations at some of their pulp and paper plants.

Portfolio Information

About Fund Performance

Past performance is not an indication 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 each 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. Beginning August 10, 2020, the price used to calculate market return (“Market Price”) is the closing price. Prior to August 10, 2020, Market Price was determined 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.

Disclosure of Expenses

Shareholders of each Fund may incur the following charges: (1) transactional expenses, including brokerage commissions on purchases and sales of fund shares and (2) ongoing expenses, including management fees and other fund expenses. The expense examples shown (which are based on a hypothetical investment of $1,000 invested at the beginning of the period and held through the end of the period) are intended to assist shareholders both in calculating expenses based on an investment in each Fund and in comparing these expenses with similar costs of investing in other funds.

The expense examples provide information about actual account values and actual expenses. Annualized expense ratios reflect contractual and voluntary fee waivers, if any. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number under the heading entitled “Expenses Paid During the Period.”

The expense examples also provide information about hypothetical account values and hypothetical expenses based on a fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in the Funds and other funds, compare the 5% hypothetical examples with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

The expenses shown in the expense examples are intended to highlight shareholders’ ongoing costs only and do not reflect any transactional expenses, such as brokerage commissions and other fees paid on purchases and sales of fund shares. Therefore, the hypothetical examples are useful in comparing ongoing expenses only and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher.

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the period ended March 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

Affiliates (continued)

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

For the period ended March 31, 2023, the effect of derivative financial instruments in the Statements of Operations was as follows:

Average Quarterly Balances of Outstanding Derivative Financial Instruments

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of financial instruments. For a description of the input levels and information about the Fund’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the Fund’s financial instruments categorized in the fair value hierarchy. The breakdown of the Fund’s financial instruments into major categories is disclosed in the Schedule of Investments above.

Fair Value Hierarchy as of Period End (continued)

See notes to financial statements.

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the year ended March 31, 2023 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows: