LOGO

  JULY 31, 2022

 

 

  

  

2022 Annual Report

 

 

iShares U.S. ETF Trust

·   iShares Evolved U.S. Consumer Staples ETF | IECS | Cboe BZX

·   iShares Evolved U.S. Discretionary Spending ETF | IEDI | Cboe BZX

·   iShares Evolved U.S. Financials ETF | IEFN | Cboe BZX

·   iShares Evolved U.S. Healthcare Staples ETF | IEHS | Cboe BZX

·   iShares Evolved U.S. Innovative Healthcare ETF | IEIH | Cboe BZX

·   iShares Evolved U.S. Media and Entertainment ETF | IEME | Cboe BZX

·   iShares Evolved U.S. Technology ETF | IETC | Cboe BZX


The Markets in Review

Dear Shareholder,

The 12-month reporting period as of July 31, 2022 saw the emergence of significant challenges that disrupted the economic recovery and strong financial markets. The U.S. economy shrank in the first half of 2022, ending the run of robust growth that followed the reopening of global economies and the development of COVID-19 vaccines. Changes in consumer spending patterns and a tight labor market led to elevated inflation, which reached a 40-year high. Moreover, while the foremost effect of Russia’s invasion of Ukraine has been a severe humanitarian crisis, the ongoing war continued to present challenges for both investors and policymakers.

Equity prices fell as interest rates rose, particularly weighing on relatively high-valuation growth stocks and economically sensitive small-capitalization stocks. While both large- and small-capitalization U.S. stocks fell, declines for small-capitalization U.S. stocks were steeper. Both emerging market stocks and international equities from developed markets fell significantly, pressured by rising interest rates and a strengthening U.S. dollar.

The 10-year U.S. Treasury yield (which is inversely related to bond prices) rose notably during the reporting period as investors reacted to higher inflation and attempted to anticipate its impact on future interest rate changes. The corporate bond market also faced inflationary headwinds, and increasing uncertainty led to higher corporate bond spreads (the difference in yield between U.S. Treasuries and similarly-dated corporate bonds).

The U.S. Federal Reserve (the “Fed”), acknowledging that inflation is growing faster than expected, raised interest rates four times while indicating that additional rate hikes were likely. Furthermore, the Fed wound down its bond-buying programs and began to reduce its balance sheet. Continued high inflation and the Fed’s statements led many analysts to anticipate that interest rates have room to rise before peaking, although investors’ inflation expectations began to decline near the end of the period.

The horrific war in Ukraine has significantly clouded the outlook for the global economy, leading to major volatility in energy and metals markets. Sanctions on Russia, Europe’s top energy supplier, and general wartime disruption have magnified supply problems for key commodities. We believe elevated energy prices will continue to exacerbate inflationary pressure while also constraining economic growth. Combating inflation without stifling a recovery, while buffering against ongoing supply and price shocks, will be an especially challenging environment for setting effective monetary policy. Despite the likelihood of more rate increases on the horizon, we believe the Fed will ultimately err on the side of protecting employment, even at the expense of higher inflation. In the meantime, however, we believe that we are likely to see a period of slowing growth paired with relatively high inflation.

In this environment, while we favor an overweight to equities in the long-term, the market’s concerns over excessive rate hikes from central banks moderate our outlook. Furthermore, the energy shock and a deteriorating economic backdrop in China and Europe are likely to challenge corporate earnings, so we are underweight equities overall in the near-term. We take the opposite view on credit, where higher spreads provide near-term opportunities, while the likelihood of higher inflation leads us to take an underweight stance on credit in the long-term. We believe that investment-grade corporates, U.K. gilts, local-currency emerging market debt, and inflation-protected bonds (particularly in Europe) offer strong opportunities for a six- to twelve-month horizon.

Overall, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit iShares.com for further insight about investing in today’s markets.

Sincerely,

 

LOGO

Rob Kapito

President, BlackRock, Inc.

LOGO

Rob Kapito

President, BlackRock, Inc.

 

Total Returns as of July 31, 2022  
     
       6-Month       12-Month  
   

U.S. large cap equities
(S&P 500® Index)

    (7.81 )%      (4.64 )% 
   

U.S. small cap equities
(Russell 2000® Index)

    (6.42     (14.29
   

International equities
(MSCI Europe, Australasia, Far East Index)

    (11.27     (14.32
   

Emerging market equities
(MSCI Emerging Markets Index)

    (16.24     (20.09
   

3-month Treasury bills
(ICE BofA 3-Month U.S. Treasury Bill Index)

    0.21       0.22  
   

U.S. Treasury securities
(ICE BofA 10-Year U.S. Treasury Index)

    (6.38     (10.00
   

U.S. investment grade bonds
(Bloomberg U.S. Aggregate Bond Index)

    (6.14     (9.12
   

Tax-exempt municipal bonds
(Bloomberg Municipal Bond Index)

    (3.95     (6.93
   

U.S. high yield bonds
(Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index)

    (6.58     (8.03

Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

 

 

 

2  

T H I S   P A G E   I S   N O T   P A R T   O F   Y O U R   F U N D   R E P O R T


Table of Contents

 

 

     Page  

 

 

The Markets in Review

     2  

Annual Report:

  

Market Overview

     4  

Fund Summary

     5  

About Fund Performance

     19  

Disclosure of Expenses

     19  

Schedules of Investments

     20  

Financial Statements:

  

Statements of Assets and Liabilities

     44  

Statements of Operations

     46  

Statements of Changes in Net Assets

     48  

Financial Highlights

     52  

Notes to Financial Statements

     59  

Report of Independent Registered Public Accounting Firm

     67  

Important Tax Information

     68  

Board Review and Approval of Investment Advisory Contract

     69  

Supplemental Information

     71  

Trustee and Officer Information

     72  

General Information

     75  

Glossary of Terms Used in this Report

     76  

 

 

  3


Market Overview

 

iShares U.S. ETF Trust

Domestic Market Overview

U.S. stocks declined for the 12 months ended July 31, 2022 (“reporting period”), when the Russell 3000® Index, a broad measure of U.S. equity market performance, returned -7.35%. Equities advanced early in the reporting period as strong household balance sheets and robust job growth supported rising consumer spending. Increased economic activity led to strong corporate earnings as companies reaped the benefits amid a recovery from the effects of the coronavirus pandemic. However, significant challenges emerged as the reporting period continued, including high inflation, rising interest rates, slower economic growth, and the impacts of Russia’s invasion of Ukraine. These factors drove stock prices sharply lower, erasing prior gains and leading to significantly negative performance for the reporting period overall.

The U.S. economy grew briskly over the final half of 2021, powered primarily by consumer spending. Record-high personal savings rates allowed consumers to spend at an elevated level, releasing pent-up demand for goods and services. Growth subsequently stalled in the first half of 2022, and the economy contracted amid lower inventories and faltering business investment. Despite the economic downturn, indicators were mixed, showing evidence of a slowdown in some areas while others remained positive. Hiring continued to increase as businesses restored capacity, and unemployment declined substantially, falling to 3.5% in July 2022 — identical to the pre-pandemic rate in February 2020. Although high inflation negatively impacted consumer sentiment, which declined significantly, consumer spending continued to rise.

The rapid increase in consumer spending drove a significant rise in inflation. Supply chains for many goods were disrupted by the pandemic and could not quickly adapt to the rapid rebound in demand. Oil prices also rose significantly as demand increased and a lack of investment constrained the supply of oil. The strong job market led to higher wages, particularly at the lower end of the market. These factors drove prices higher in many areas of the economy.

Rising inflation led to a shift in policy from the U.S. Federal Reserve (“the Fed”). As the reporting period began, the Fed was using accommodative monetary policy to stimulate the economy. Short-term interest rates were kept at near-zero levels, and the Fed used bond-buying programs to stabilize debt markets. However, rising prices led the Fed to tighten monetary policy during the reporting period in an attempt to prevent runaway inflation. The Fed slowed and then ended its bond-buying activities, finally reversing course as it began to reduce its balance sheet in June 2022.

In March 2022, the Fed began to raise short-term interest rates, followed by three more increases for a total increase of 225 basis points, the most rapid rise in decades. Interest rates rose significantly in response, leading to higher borrowing costs for businesses. The effect of higher inflation and interest rates on equities varied significantly based on equity class. Growth stocks, which derive much of their value from expectations of future growth, declined significantly more than value stocks.

Russia’s invasion of Ukraine in late February 2022 led to substantial disruptions to the global economy and increased uncertainty in financial markets, exacerbating inflation and impacting U.S. businesses with operations in Russia. The invasion was met with widespread condemnation, and many countries imposed sanctions on the Russian state, businesses, and individuals. As Russia is a top producer of both oil and natural gas, global supply concerns led to sharp volatility in U.S. energy markets.

 

 

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2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Fund Summary as of July 31, 2022     iShares® Evolved U.S. Consumer Staples ETF

 

Investment Objective

The iShares Evolved U.S. Consumer Staples ETF (the “Fund”) seeks to provide access to U.S. companies with consumer staples exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    4.67      10.48       4.67      54.51

Fund Market

    4.78        10.48         4.78        54.47  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         999.30            $         0.89               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  5


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Consumer Staples ETF

 

Portfolio Management Commentary

Consumer staples stocks in the U.S. advanced for the reporting period as investors, amid turbulent financial markets, sought equities generally viewed as less volatile than the broader market. Businesses within the sector offer relatively steady income and attractive dividend payouts that further enticed investors amid the increased market and economic uncertainty of early 2022. As a sector, staples outperformed all but two other U.S equity sectors (energy and utilities) for the reporting period, based on S&P Dow Jones Indices.

Large beverage companies Coca-Cola and Pepsico contributed the most to the Fund’s return. The companies benefited as sales volumes at restaurants and other public venues continued to rebound from the coronavirus pandemic. Price increases bolstered revenue gains and partly helped offset higher costs and business disruptions in Russia due to sanctions after the invasion of Ukraine. Pepsico, which has a complementary product line of snacks, benefited by combatting cost inflation for supplies with higher prices and smaller package sizes, which increased revenues.

Prepared food and snacks manufacturer, such as General Mills, also contributed to the Fund’s performance. Sales in the industry increased as companies absorbed rising input costs by increasing prices. Candy makers, including Hershey Foods, also advanced as increased production capacity failed to meet the strong demand for those products. Meanwhile, Archer Daniels Midland and other agricultural commodities processors benefited from tight global grain supplies and corresponding higher market prices, in addition to rising demand for their ingredients.

The Fund’s evolved investment process looks beyond the traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several consumer staples companies with similar businesses that have traditionally been categorized in other sectors. For example, the Fund held positions in Starbucks and Chipotle Mexican Grill, which are typically classified as companies in the consumer discretionary sector. These global quick service restaurant companies detracted from the Fund’s return as consumers’ overall discretionary spending declined during the reporting period, while food and ingredient costs rose.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Beverages

    32.6

Food

    24.6  

Agriculture

    11.8  

Cosmetics & Personal Care

    9.7  

Retail

    9.6  

Packaging & Containers

    2.7  

Household Products & Wares

    1.9  

Chemicals

    1.9  

Pharmaceuticals

    1.7  

Biotechnology

    1.0  

Other (each representing less than 1%)

    2.5  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Coca-Cola Co. (The)

    12.0

PepsiCo Inc.

    11.0  

Procter & Gamble Co. (The)

    7.5  

Philip Morris International Inc.

    4.8  

Mondelez International Inc., Class A

    4.6  

General Mills Inc.

    3.7  

Altria Group Inc.

    3.7  

Starbucks Corp.

    3.2  

Monster Beverage Corp.

    3.0  

McDonald’s Corp.

    2.8  

 

  (a) 

Excludes money market funds.

 

 

 

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Fund Summary as of July 31, 2022      iShares® Evolved U.S. Discretionary Spending ETF

 

Investment Objective

The iShares Evolved U.S. Discretionary Spending ETF (the “Fund”) seeks to provide access to U.S. companies with discretionary spending exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
             1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (12.65 )%       12.30       (12.65 )%       65.92

Fund Market

    (12.63      12.30         (12.63      65.90  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual    

Hypothetical 5% Return

          
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         887.60            $         0.84               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  7


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Discretionary Spending ETF

 

Portfolio Management Commentary

Stocks related to U.S. discretionary spending declined for the reporting period amid a variety of economic concerns, including rising inflation, Fed interest rate increases, and the war between Russia and Ukraine. As U.S. economic output contracted, consumers contemplated the possibility of a recession. Discretionary spending decreased during the reporting period, and the outlook for a near-term rebound appeared uncertain, weighing on stocks within the sector.

The commerce industry detracted the most from the Fund’s return, driven by internet commerce and direct marketers. Large e-commerce retailer Amazon declined as rising inflation led to increased labor costs and decreasing sales. Supply-chain problems further exacerbated a reduction in profit margins. Amazon’s addition of warehouse space and expansion of transportation networks during the height of the coronavirus pandemic yielded excess capacity that added to expenses when sales declined in the first half of 2022. As many investors associate e-commerce retailers with the information technology sector, that sector’s overall decline in early 2022 also weighed on companies like Amazon.

Traditional in-store retail outlets likewise detracted from the Fund’s performance. Many large chains canceled orders and marked down merchandise they had purchased during the height of the pandemic — merchandise that consumers no longer found attractive as pandemic-related restrictions disappeared and inflation increased. Sales for discount outlets Ross Stores and Burlington Stores, which cater to more cost-conscious consumers, also increasingly declined amid rising inflation, while inventory levels rose substantially. Nike a leading footwear marketer, also detracted amid a withdrawal from Russia, China’s pandemic-related lockdowns, rising freight and logistics costs, questions about the North American market outlook, and concerns about labor practices in western China.

The Fund’s evolved investment process looks beyond the traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several companies with similar businesses that traditionally have been categorized in other sectors. For example, the Fund held positions in warehouse general merchandise chains, such as Costco, which is generally classified in the consumer staples sector. Costco advanced as it profited from shoppers seeking the benefits of bulk pricing.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Retail

    54.8

Internet

    21.6  

Apparel

    6.2  

Cosmetics & Personal Care

    3.9  

Lodging

    2.4  

Food

    1.8  

Commercial Services

    1.5  

Entertainment

    1.1  

Computers

    1.1  

Distribution & Wholesale

    1.0  

Other (each representing less than 1%)

    4.6  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Amazon.com Inc.

    17.8

Home Depot Inc. (The)

    8.1  

Costco Wholesale Corp.

    7.4  

Walmart Inc.

    6.0  

Nike Inc., Class B

    3.8  

McDonald’s Corp.

    3.5  

Lowe’s Companies Inc.

    3.2  

Target Corp.

    2.8  

Procter & Gamble Co. (The)

    2.6  

TJX Companies Inc. (The)

    2.3  

 

  (a) 

Excludes money market funds.

 

 

 

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2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Fund Summary as of July 31, 2022      iShares® Evolved U.S. Financials ETF

 

Investment Objective

The iShares Evolved U.S. Financials ETF (the “Fund”) seeks to provide access to U.S. companies with financials exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (3.23 )%       6.17       (3.23 )%       29.88

Fund Market

    (3.24      6.17         (3.24      29.87  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         892.10            $         0.84               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  9


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Financials ETF

 

Portfolio Management Commentary

U.S. financials stocks declined for the reporting period amid a steep decline in the broader stock market and myriad economic challenges. Rising inflation, Fed interest rate increases, and the war between Russia and Ukraine created significant economic headwinds.

A diverse group of financial services companies, including asset managers, investment banks, and credit ratings agencies detracted from the Fund’s performance. Asset management companies, such as T. Rowe Price Group, declined alongside the broader equity market. Cash inflows into equity investment funds declined considerably in the first half of 2022, and bond funds posted net outflows, reducing fees and profitability. Investment banks Morgan Stanley and Goldman Sachs detracted amid substantial decreases in revenue and in deal-making in capital markets. Investors reacted negatively to the disappointing near-term revenue outlook. In addition, stock underwriting for initial public offerings all but halted. Meanwhile, investment ratings agency Moody’s Corporation declined following a sharp decrease in corporate debt issuance amid a rising interest rate environment, which led to reduced earnings visibility.

Credit card issuers also detracted from the Fund’s return as the U.S. economy slowed. For example, Capital One Financial Corporation declined, despite benefiting both from increased consumer spending in the wake of pent-up, pandemic-induced demand and from assets yielding higher interest income. Investors grew cautious about the uncertain outlook for continued consumer spending amid mounting recession concerns, as credit card fee revenue highly correlates with customer transactions.

The Fund’s evolved investment process looks beyond traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several financials companies with similar businesses that traditionally have been categorized in other sectors. For example, Fidelity National Information Services, which is traditionally categorized in the information technology sector, declined from relative performance as mobile and e-commerce payment gateway providers faced a challenging business outlook. On the upside, companies in the healthcare sector, such as UnitedHealth Group, a large managed healthcare company, contributed to the Fund’s relative performance. UnitedHealth benefited from lower expenses for coronavirus-related care and increased insurance enrollment.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Banks

    40.3

Insurance

    25.0  

Diversified Financial Services

    17.1  

Commercial Services

    4.2  

Health Care - Services

    4.1  

Software

    2.5  

Pharmaceuticals

    1.9  

Machinery

    1.2  

Private Equity

    1.2  

Other (each representing less than 1%)

    2.5  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Wells Fargo & Co.

    4.3

JPMorgan Chase & Co.

    4.0  

Bank of America Corp.

    3.9  

Berkshire Hathaway Inc., Class B

    3.3  

Goldman Sachs Group Inc. (The)

    3.0  

Morgan Stanley

    2.9  

Charles Schwab Corp. (The)

    2.8  

UnitedHealth Group Inc.

    2.8  

Citigroup Inc.

    2.3  

Truist Financial Corp.

    2.1  

 

  (a) 

Excludes money market funds.

 

 

 

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Fund Summary as of July 31, 2022      iShares® Evolved U.S. Healthcare Staples ETF

 

Investment Objective

The iShares Evolved U.S. Healthcare Staples ETF (the “Fund”) seeks to provide access to U.S. companies with healthcare staples exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (5.09 )%       13.29       (5.09 )%       72.41

Fund Market

    (5.24      13.26         (5.24      72.17  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         978.00            $         0.88               $        1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  11


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Healthcare Staples ETF

 

Portfolio Management Commentary

U.S. healthcare staples stocks declined modestly for the reporting period as inflationary pressures, labor shortages, and resurging coronavirus waves outweighed favorable spending trends and pent-up demand for elective surgeries. Healthcare equipment stocks detracted the most from the Fund’s return, due to continuing supply-chain challenges and pandemic-related delays. Medtronic reported lower sales as recurring lockdowns in China constrained supply of raw materials and added to logistics delays. The shortage of nurses in the U.S. further limited the number of medical procedures conducted at hospitals. Deferred procedures due to COVID-19 also lowered sales volumes and increased near-term spending for Intuitive Surgical despite increased adoption of the firm’s robotic surgical platform. Stryker also reported a rise in sales for its surgical robots; however, the company’s revenue growth slowed overall as hospital clients increasingly shifted away from outright purchases in favor of rental or longer-term financing contracts. The resurging COVID-19 waves drove sales higher for at-home antigen tests, but test-maker Abbott Laboratories’ stock declined after a recall of baby formula products halted factory production and exacerbated a nationwide shortage.

Life sciences tools and services stocks also weighed on the Fund’s return. China’s lockdowns led to significantly lowered sales for gene-sequencing supplier Illumina. Regulatory pressure in the U.S. and Europe regarding a recent acquisition also dampened investor enthusiasm for the firm’s stock.

On the upside, managed healthcare companies contributed to the Fund’s performance as investors sought out businesses with less exposure to inflation impacts. UnitedHealth Group was the largest contributor as the managed healthcare conglomerate increased revenue through diversified business strategies, including expanding low-cost telehealth offerings and other non-hospital-based health services.

The Fund’s evolved investment process looks beyond traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activities. During the reporting period, the evolved process identified several healthcare companies with similar businesses that have traditionally been categorized in other sectors. In the real estate investment trust (“REIT”) industry, Healthpeak Properties, which owns and develops private healthcare facilities, declined due to weakness in its continuing care residential community segment due to a one-time repayment of CARES Act relief funds.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Health Care - Products

    43.2

Health Care - Services

    31.2  

Pharmaceuticals

    20.0  

Biotechnology

    1.5  

Real Estate Investment Trusts

    1.2  

Electronics

    1.1  

Other (each representing less than 1%)

    1.8  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

UnitedHealth Group Inc.

    16.7

Abbott Laboratories

    7.5  

Danaher Corp.

    5.1  

Johnson & Johnson

    4.8  

Medtronic PLC

    4.5  

Thermo Fisher Scientific Inc.

    4.2  

Elevance Health Inc.

    3.4  

CVS Health Corp.

    3.4  

AbbVie Inc.

    3.2  

Intuitive Surgical Inc.

    3.2  

 

  (a) 

Excludes money market funds.

 

 

 

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Fund Summary as of July 31, 2022      iShares® Evolved U.S. Innovative Healthcare ETF

 

Investment Objective

The iShares Evolved U.S. Innovative Healthcare ETF (the “Fund”) seeks to provide access to U.S. companies with innovative healthcare exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (4.26 )%       9.64       (4.26 )%       49.44

Fund Market

    (4.22      9.63         (4.22      49.34  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $        1,015.20            $         0.90               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  13


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Innovative Healthcare ETF

 

Portfolio Management Commentary

U.S. innovative healthcare stocks declined modestly during the reporting period as the rising interest rate environment weighed on high-valuation stocks and cooled capital flows. Recurring COVID-19 outbreaks added to the uncertain market environment as drugmakers struggled with mismatches between vaccine supply and demand. Merger and acquisition activity within the pharmaceutical industry dropped to one of the lowest levels in the last decade amid heightened regulatory scrutiny.

Biotechnology stocks detracted the most from the Fund’s return as declining COVID-19 vaccine sales and research funding pressured the earnings of companies such as Moderna and Novavax. Moderna announced the development of a new vaccine targeting the omicron variant even as declining case rates raised doubts about the necessity of variant-specific vaccines. Competition from the introduction of new treatments for COVID-19 weighed particularly hard on less diversified companies such as Moderna, which derive nearly all their revenue from vaccines.

Other biotechnology companies reported disappointing drug sales. Biogen’s highly anticipated Alzheimer’s treatment, widely criticized for its initial high price point, encountered multiple distribution hurdles with insurance companies and prominent medical centers. Gilead Sciences’ stock also trended lower due to falling sales of its COVID-19 antiviral drug for hospitalized patients, despite increased revenue from its cancer and HIV drug divisions. In addition, clinical-stage oncology company Mirati Therapeutics reported mixed clinical trial results for its new KRAS-mutation targeting cancer drug. Competitive category pressure and management turnover further marred the stock’s performance.

On the upside, pharmaceuticals companies such as Pfizer and Eli Lilly contributed to the Fund’s return. These broadly diversified companies hold large amounts of cash on their balance sheets and generated revenue gains across multiple categories, making them less dependent on COVID-19 related drug sales alone.

The Fund’s evolved investment process looks beyond the traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several healthcare companies with similar businesses that have traditionally been categorized in other sectors. In the information technology sector, Universal Display Corporation detracted from the Fund’s return due to rising commodities prices and increased competition.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Biotechnology

    47.7

Pharmaceuticals

    46.9  

Health Care - Products

    3.2  

Health Care - Services

    2.0  

Other (each representing less than 1%)

    0.2  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Johnson & Johnson

    11.2

Eli Lilly & Co.

    8.2  

AbbVie Inc.

    6.6  

Merck & Co. Inc.

    6.3  

Bristol-Myers Squibb Co.

    5.8  

Vertex Pharmaceuticals Inc.

    5.6  

Amgen Inc.

    4.8  

Moderna Inc.

    4.7  

Gilead Sciences Inc.

    4.4  

Regeneron Pharmaceuticals Inc.

    4.3  

 

  (a) 

Excludes money market funds.

 

 

 

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Fund Summary as of July 31, 2022      iShares® Evolved U.S. Media and Entertainment ETF

 

Investment Objective

The iShares Evolved U.S. Media and Entertainment ETF (the “Fund”) seeks to provide access to U.S. companies with media and entertainment exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (29.16 )%       2.93       (29.16 )%       13.45

Fund Market

    (29.13      2.91         (29.13      13.35  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period(

 

 

a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         808.40            $         0.81               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  15


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Media and Entertainment ETF

 

Portfolio Management Commentary

U.S. media and entertainment stocks declined sharply during the reporting period amid slowing global economic growth and a consumer shift from digital back to in-person experiences. Rising inflation increased costs, and relatively high valuations led investors to closely scrutinize corporate earnings.

Entertainment media companies detracted the most from the Fund’s return. Profits decreased as operating costs increased at Roku, a streaming and television interface company, while revenue from digital advertising declined. Increased competition also weighed on Roku as Microsoft Corporation announced plans to enter the streaming device market. Streaming service Netflix also detracted significantly, losing subscribers as customers in search of new content switched services frequently. Furthermore, Netflix incurred high costs from creating original programming to attract subscribers. The Walt Disney Company, a media conglomerate, also declined as increased competition, slowing growth, and rising costs reduced profits from its Disney Plus streaming media service. While its theme parks showed strength following the loosening of coronavirus-related restrictions, a conflict with Florida’s state government negatively impacted the company.

Broadband service companies also detracted meaningfully from the Fund’s return. New high speed internet options, such as fiberoptic services offered by wireless companies, led to increased competition for broadband service. While revenues rose at Charter Communications, a provider of cable and internet service, subscriber growth slowed markedly. Telecommunications conglomerate Comcast Communications declined due to weak growth in its streaming service, Peacock, and its broadband service, as home buying slowed, and customers switched to mobile broadband services. In the social media industry, uncertainty about billionaire Elon Musk’s plans to purchase microblogging platform Twitter led to significant price volatility for Twitter’s stock.

The Fund’s evolved investment process looks beyond the traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several consumer discretionary companies with similar businesses that have traditionally been categorized in other sectors. For example, Caesars Entertainment, a hotel and casino company, detracted from the Fund’s return. Profits from alcohol sales and gambling declined as customers reduced spending amid rising inflation.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Media

    54.1

Internet

    14.5  

Software

    12.7  

Entertainment

    8.9  

Toys, Games & Hobbies

    3.3  

Commercial Services

    2.2  

Real Estate Investment Trusts

    1.5  

Retail

    1.0  

Other (each representing less than 1%)

    1.8  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Fox Corp., Class A

    5.1

Activision Blizzard Inc.

    5.0  

Electronic Arts Inc.

    4.6  

Comcast Corp., Class A

    4.6  

Nexstar Media Group Inc., Class A

    4.5  

Walt Disney Co. (The)

    4.4  

Paramount Global, Class B

    4.0  

Charter Communications Inc., Class A

    3.8  

Twitter Inc.

    3.7  

Warner Bros. Discovery Inc.

    3.1  

 

  (a) 

Excludes money market funds.

 

 

 

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Fund Summary as of July 31, 2022      iShares® Evolved U.S. Technology ETF

 

Investment Objective

The iShares Evolved U.S. Technology ETF (the “Fund”) seeks to provide access to U.S. companies with technology exposure, as classified using a proprietary classification system. The Fund is an actively managed exchange-traded fund that does not seek to replicate the performance of a specified index.

Performance

 

        Average Annual Total Returns               Cumulative Total Returns  
               1 Year      Since
Inception
                     1 Year      Since
Inception
 

Fund NAV

    (16.02 )%       16.86       (16.02 )%       97.39

Fund Market

    (16.12      16.85         (16.12      97.28  

S&P Total Market IndexTM

    (7.78      11.16               (7.78      58.60  

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

 

LOGO

The inception date of the Fund was March 21, 2018. The first day of secondary market trading was March 23, 2018.

The S&P Total Market IndexTM is an unmanaged index designed to track the broad equity market, including large-, mid-, small-, and micro-cap stocks.

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

 

    Actual     Hypothetical 5% Return           
 

 

 

     

 

 

      
     

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period

 

 

(a)  

           

Beginning

Account Value

(02/01/22)

 

 

 

      

Ending

Account Value

(07/31/22)

 

 

 

      

Expenses

Paid During

the Period(

 

 

a)  

      

Annualized

Expense

Ratio

 

 

 

      $       1,000.00            $         843.30            $         0.82               $       1,000.00            $      1,023.90            $         0.90          0.18

 

  (a) 

Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period shown). Other fees, such as brokerage commissions and other fees to financial intermediaries, may be paid which are not reflected in the tables and examples above. See “Disclosure of Expenses” for more information.

 

 

 

F U N D   S U M M A R Y

  17


Fund Summary as of July 31, 2022  (continued)    iShares® Evolved U.S. Technology ETF

 

Portfolio Management Commentary

U.S. technology stocks declined significantly during the reporting period. As in-person work and commerce resumed, demand weakened for certain software and online services that facilitated business during pandemic-related restrictions. Amid rising inflation, higher interest rates negatively impacted the highest valuation growth-oriented technology stocks by lowering the current value of future earnings, decreasing demand and cash flows, and raising financing costs.

The specialized software industry detracted the most from the Fund’s performance as the need for digital solutions for online learning and working diminished. Adobe Incorporated led the decline as growth in sales of its creative software platform declined. The company suspended business in Russia due to that country’s invasion of Ukraine, negatively impacting revenues. Despite strong earnings, cloud-based customer relationship management specialist Salesforce declined as investors generally turned away from high-growth stocks. Docusign Incorporated also detracted as growth in demand for digital signatures slowed sharply with many businesses returning to in-person work.

Technology service providers also detracted substantially from the Fund’s return. Online payment company PayPal declined, reflecting ongoing disruptions to supply chains and a decrease in online shopping. Earnings slowed as the company faced difficulty in growing its active user base. The high interest rate environment weighed on Block, a financial technology company, reducing demand for loans among its small business customers. A sharp decline in the price of Bitcoin also negatively impacted Block’s balance sheet.

The Fund’s evolved investment process looks beyond the traditional sector definitions by applying machine learning and natural language processing to group individual companies with related business activity. During the reporting period, the evolved process identified several technology companies with similar businesses that have traditionally been categorized in other sectors. For example, the Fund held positions in Meta and Alphabet Inc., Facebook and Google’s parent companies, respectively, both traditionally classified as communication services companies. Meta’s revenues declined as growth in demand for digital advertisements contracted amid the global economic slowdown and ongoing supply chain disruptions. Although revenue from Google search advertising fared relatively well, Alphabet declined amid disappointing sales in its YouTube and Google Cloud businesses. Currency effects due to the strong U.S. dollar also weighed on Alphabet as the majority of its sales originate outside the U.S.

Portfolio Information

 

 

INDUSTRY ALLOCATION

 

 

   
Sector    

Percent of

Total Investments

 

(a) 

Software

    31.3

Internet

    22.5  

Computers

    18.2  

Semiconductors

    12.5  

Diversified Financial Services

    5.7  

Commercial Services

    3.8  

Telecommunications

    2.1  

Other (each representing less than 1%)

    3.9  

TEN LARGEST HOLDINGS

 

 

   
Security    

Percent of

Total Investments

 

(a) 

Microsoft Corp.

    15.9

Apple Inc.

    13.2  

Amazon.com Inc.

    5.8  

Alphabet Inc., Class A

    5.1  

Alphabet Inc., Class C

    5.0  

Nvidia Corp.

    4.0  

Meta Platforms Inc, Class A

    3.0  

Visa Inc., Class A

    2.6  

Mastercard Inc., Class A

    2.1  

Adobe Inc.

    1.7  

 

  (a) 

Excludes money market funds.

 

 

 

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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 a 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.

 

 

A B O U T   F U N D   P E R F O R M A N C E / S H A R E H O L D E R   E X P E N S E S

  19


Schedule of Investments  

July 31, 2022

  

iShares® Evolved U.S. Consumer Staples ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Agriculture — 11.7%

   

Altria Group Inc.

    14,153     $ 620,750  

Archer-Daniels-Midland Co.

    4,818       398,786  

Bunge Ltd.

    912       84,205  

Darling Ingredients Inc.(a)

    870       60,274  

Fresh Del Monte Produce Inc.

    169       5,021  

Philip Morris International Inc.

    8,303       806,636  

Universal Corp./VA

    124       6,933  

Vector Group Ltd.

    377       4,200  
   

 

 

 
          1,986,805  
Beverages — 32.3%            

Boston Beer Co. Inc. (The), Class A, NVS(a)

    70       26,630  

Brown-Forman Corp., Class A, NVS

    372       26,933  

Brown-Forman Corp., Class B

    2,797       207,593  

Celsius Holdings Inc.(a)

    447       39,765  

Coca-Cola Co. (The)

    31,375       2,013,334  

Coca-Cola Consolidated Inc.

    51       26,163  

Constellation Brands Inc., Class A

    982       241,876  

Keurig Dr Pepper Inc.

    10,314       399,564  

MGP Ingredients Inc.

    110       11,570  

Molson Coors Beverage Co., Class B

    1,500       89,625  

Monster Beverage Corp.(a)

    5,133       511,349  

National Beverage Corp.

    300       16,254  

PepsiCo Inc.

    10,612       1,856,676  

Primo Water Corp.

    1,508       19,936  
   

 

 

 
      5,487,268  
Biotechnology — 1.0%            

Corteva Inc.

    2,899       166,838  
   

 

 

 

Chemicals — 1.9%

   

Balchem Corp.

    162       21,993  

Ecolab Inc.

    142       23,454  

FMC Corp.

    63       7,000  

International Flavors & Fragrances Inc.

    1,842       228,500  

Mosaic Co. (The)

    361       19,010  

Sensient Technologies Corp.

    240       20,635  
   

 

 

 
      320,592  
Commercial Services — 0.0%            

Medifast Inc.

    59       9,923  

WW International Inc.(a)

    180       1,195  
   

 

 

 
      11,118  
Computers — 0.1%            

ExlService Holdings Inc.(a)

    99       16,669  
   

 

 

 

Cosmetics & Personal Care — 9.6%

   

Colgate-Palmolive Co.

    4,372       344,251  

Coty Inc., Class A(a)

    1,840       13,469  

Edgewell Personal Care Co.

    150       5,967  

Procter & Gamble Co. (The)

    9,107       1,265,054  
   

 

 

 
      1,628,741  
Diversified Financial Services — 0.0%            

Jefferies Financial Group Inc.

    2       65  
   

 

 

 

Electrical Components & Equipment — 0.1%

   

Energizer Holdings Inc.

    380       11,221  
   

 

 

 

Food — 24.3%

   

B&G Foods Inc.

    770       19,027  

Beyond Meat Inc.(a)

    389       12,444  
Security   Shares     Value  

Food (continued)

   

Calavo Growers Inc.

    110     $ 4,433  

Cal-Maine Foods Inc.

    200       10,222  

Campbell Soup Co.

    2,223       109,705  

Conagra Brands Inc.

    5,429       185,726  

Flowers Foods Inc.

    1,190       33,808  

General Mills Inc.

    8,314       621,804  

Hain Celestial Group Inc. (The)(a)

    1,040       23,660  

Hershey Co. (The)

    1,753       399,614  

Hormel Foods Corp.

    2,439       120,340  

Hostess Brands Inc.(a)

    650       14,703  

Ingredion Inc.

    504       45,854  

J&J Snack Foods Corp.

    130       17,616  

JM Smucker Co. (The)

    1,248       165,135  

John B Sanfilippo & Son Inc.

    90       6,741  

Kellogg Co.

    3,153       233,070  

Kraft Heinz Co. (The)

    6,041       222,490  

Kroger Co. (The)

    1,836       85,264  

Lamb Weston Holdings Inc.

    1,198       95,433  

Lancaster Colony Corp.

    170       22,505  

McCormick & Co. Inc./MD, NVS

    2,141       187,016  

Mondelez International Inc., Class A

    11,941       764,702  

Performance Food Group Co.(a)

    711       35,344  

Pilgrim’s Pride Corp.(a)

    300       9,411  

Post Holdings Inc.(a)

    687       59,728  

Seaboard Corp.

    1       4,061  

Simply Good Foods Co. (The)(a)

    718       23,421  

Sprouts Farmers Market Inc.(a)

    450       12,438  

Sysco Corp.

    3,186       270,491  

Tootsie Roll Industries Inc.

    158       5,549  

TreeHouse Foods Inc.(a)

    640       27,789  

Tyson Foods Inc., Class A

    2,728       240,091  

U.S. Foods Holding Corp.(a)

    1,052       33,138  

United Natural Foods Inc.(a)

    220       9,352  
   

 

 

 
          4,132,125  
Health Care - Products — 0.1%            

Neogen Corp.(a)

    540       12,490  
   

 

 

 

Holding Companies - Diversified — 0.0%

   

Cannae Holdings Inc.(a)

    298       6,291  
   

 

 

 

Household Products & Wares — 1.9%

   

ACCO Brands Corp.

    2       14  

Church & Dwight Co. Inc.

    1,148       100,990  

Clorox Co. (The)

    563       79,856  

Helen of Troy Ltd.(a)

    50       6,689  

Kimberly-Clark Corp.

    1,048       138,116  

WD-40 Co.

    23       4,080  
   

 

 

 
      329,745  
Housewares — 0.1%            

Newell Brands Inc.

    264       5,335  

Scotts Miracle-Gro Co. (The)

    140       12,453  
   

 

 

 
      17,788  
Insurance — 0.1%            

Reinsurance Group of America Inc.

    158       18,293  
   

 

 

 

Machinery — 0.3%

   

AGCO Corp.

    230       25,052  

Middleby Corp. (The)(a)

    170       24,597  
   

 

 

 
      49,649  

 

 

20  

2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Consumer Staples ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Manufacturing — 0.1%

   

John Bean Technologies Corp.

    120     $ 13,477  
   

 

 

 

Oil & Gas — 0.8%

   

ConocoPhillips

    1,378       134,259  
   

 

 

 

Packaging & Containers — 2.7%

   

Amcor PLC

    1,537       19,904  

AptarGroup Inc.

    39       4,203  

Ball Corp.

    2,379       174,666  

Berry Global Group Inc.(a)

    619       35,685  

Crown Holdings Inc.

    911       92,630  

Graphic Packaging Holding Co.

    1,924       42,809  

O-I Glass Inc.(a)

    780       11,474  

Packaging Corp. of America

    106       14,905  

Sealed Air Corp.

    243       14,852  

Silgan Holdings Inc.

    370       16,465  

Sonoco Products Co.

    420       26,666  
   

 

 

 
      454,259  
Pharmaceuticals — 1.7%            

BellRing Brands Inc.(a)

    1,148       27,713  

Elanco Animal Health Inc.(a)

    1,468       29,742  

Herbalife Nutrition Ltd.(a)

    459       11,204  

Perrigo Co. PLC

    131       5,485  

Prestige Consumer Healthcare Inc.(a)

    220       13,268  

Zoetis Inc.

    1,072       195,693  
   

 

 

 
              283,105  
Real Estate — 0.0%            

Douglas Elliman Inc.

    188       1,128  
   

 

 

 

Real Estate Investment Trusts — 0.6%

   

Americold Realty Trust Inc.

    841       27,543  

Equinix Inc.

    100       70,374  
   

 

 

 
      97,917  
Retail — 9.5%            

BJ’s Restaurants Inc.(a)

    61       1,432  

BJ’s Wholesale Club Holdings Inc.(a)

    264       17,873  

Casey’s General Stores Inc.

    110       22,292  

Cheesecake Factory Inc. (The)

    140       4,092  
Security   Shares     Value  
Retail (continued)            

Chipotle Mexican Grill Inc.(a)

    150     $ 234,633  

Cracker Barrel Old Country Store Inc.

    50       4,754  

Darden Restaurants Inc.

    177       22,035  

Domino’s Pizza Inc.

    82       32,153  

Freshpet Inc.(a)

    262       14,001  

Jack in the Box Inc.

    90       6,223  

McDonald’s Corp.

    1,763       464,321  

Shake Shack Inc., Class A(a)

    101       5,197  

Starbucks Corp.

    6,383       541,151  

Texas Roadhouse Inc.

    84       7,326  

Wendy’s Co. (The)

    710       14,931  

Wingstop Inc.

    90       11,356  

Yum China Holdings Inc.

    1,341       65,320  

Yum! Brands Inc.

    1,164       142,637  
   

 

 

 
      1,611,727  
Toys, Games & Hobbies — 0.1%            

Mattel Inc.(a)

    677       15,706  
   

 

 

 

Total Long-Term Investments — 99.0%
(Cost: $15,239,840)

 

    16,807,276  
   

 

 

 

Short-Term Securities

   
Money Market Funds — 0.8%            

BlackRock Cash Funds: Treasury, SL Agency Shares, 1.81%(b)(c)

    140,000       140,000  
   

 

 

 

Total Short-Term Securities — 0.8%
(Cost: $140,000)

 

    140,000  
   

 

 

 

Total Investments in Securities — 99.8%
(Cost: $15,379,840)

 

    16,947,276  

Other Assets Less Liabilities — 0.2%

 

    25,684  
   

 

 

 

Net Assets — 100.0%

 

  $   16,972,960  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

Affiliate of the Fund.

(c) 

Annualized 7-day yield as of period end.

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the year ended July 31, 2022 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

 

 
Affiliated Issuer  

Value at

07/31/21

   

Purchases

at Cost

   

Proceeds

from Sale

   

Net Realized

Gain (Loss)

   

Change in

Unrealized

Appreciation

(Depreciation)

   

Value at

07/31/22

   

Shares

Held at

07/31/22

    Income    

Capital

Gain

Distributions

from

Underlying

Funds

 

 

 

BlackRock Cash Funds: Institutional, SL Agency Shares(a)

  $ 15,208     $     $ (15,165 )(b)     $ (39    $ (4   $           $ 888 (c)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    140,000             0 (b)                   140,000       140,000       326        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
         $ (39    $ (4   $ 140,000       $  1,214     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a)

As of period end, the entity is no longer held.

 
  (b) 

Represents net amount purchased (sold).

 
  (c) 

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 

 

 

S C H E D U L E   O F   I N V E S T M E N T S

  21


Schedule of Investments  (continued)

July 31, 2022

   iShares® Evolved U.S. Consumer Staples ETF

 

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.

 

                                                                               

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Investments

                 

Assets

                 

Common Stocks

   $ 16,807,276        $        $        $ 16,807,276  

Money Market Funds

     140,000                            140,000  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 16,947,276        $        $        $ 16,947,276  
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

22  

2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  

July 31, 2022

  

iShares® Evolved U.S. Discretionary Spending ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Advertising — 0.1%

   

Interpublic Group of Companies Inc. (The)

    431     $ 12,874  
   

 

 

 

Airlines — 0.2%

   

Alaska Air Group Inc.(a)

    208       9,221  

JetBlue Airways Corp.(a)

    552       4,648  

Southwest Airlines Co.(a)

    260       9,911  
   

 

 

 
      23,780  
Apparel — 6.2%            

Capri Holdings Ltd.(a)

    526       25,606  

Carter’s Inc.

    280       22,814  

Columbia Sportswear Co.

    144       10,658  

Crocs Inc.(a)

    272       19,486  

Deckers Outdoor Corp.(a)

    129       40,404  

Hanesbrands Inc.

    1,472       16,457  

Kontoor Brands Inc.

    173       6,315  

Levi Strauss & Co., Class A

    263       4,976  

Nike Inc., Class B

    5,199       597,469  

Oxford Industries Inc.

    96       9,158  

PVH Corp.

    340       21,053  

Ralph Lauren Corp.

    241       23,770  

Skechers U.S.A. Inc., Class A(a)

    672       25,509  

Steven Madden Ltd.

    446       14,138  

Tapestry Inc.

    1,480       49,772  

Under Armour Inc., Class A(a)

    808       7,482  

Under Armour Inc., Class C, NVS(a)

    824       6,806  

Urban Outfitters Inc.(a)

    400       8,192  

VF Corp.

    1,149       51,337  

Wolverine World Wide Inc.

    248       5,573  
   

 

 

 
      966,975  
Beverages — 0.2%            

Constellation Brands Inc., Class A

    156       38,424  
   

 

 

 

Building Materials — 0.1%

   

American Woodmark Corp.(a)

    32       1,607  

Masco Corp.

    327       18,109  
   

 

 

 
      19,716  
Chemicals — 0.1%            

Valvoline Inc.

    336       10,826  
   

 

 

 

Commercial Services — 1.4%

   

Avis Budget Group Inc.(a)

    81       14,744  

Block Inc.(a)(b)

    501       38,106  

Bright Horizons Family Solutions Inc.(a)(b)

    40       3,747  

Cintas Corp.

    144       61,271  

Euronet Worldwide Inc.(a)

    80       7,862  

Grand Canyon Education Inc.(a)

    72       6,917  

H&R Block Inc.

    448       17,902  

ManpowerGroup Inc.

    120       9,409  

Monro Inc.

    136       6,820  

PayPal Holdings Inc.(a)

    252       21,806  

PROG Holdings Inc.(a)

    268       4,937  

Rent-A-Center Inc./TX

    231       5,435  

Rollins Inc.

    360       13,885  

Terminix Global Holdings Inc.(a)

    272       12,158  

WW International Inc.(a)(b)

    72       478  
   

 

 

 
      225,477  
Computers — 1.1%            

Apple Inc.

    1,025             166,573  
   

 

 

 
Security   Shares     Value  

Cosmetics & Personal Care — 3.9%

   

Colgate-Palmolive Co.

    84     $ 6,614  

Coty Inc., Class A(a)

    319       2,335  

Estee Lauder Companies Inc. (The), Class A

    715       195,266  

Inter Parfums Inc.

    62       5,175  

Procter & Gamble Co. (The)

    2,861       397,422  
   

 

 

 
            606,812  
Distribution & Wholesale — 1.0%            

Fastenal Co.

    747       38,366  

G-III Apparel Group Ltd.(a)

    232       5,125  

Leslie’s Inc.(a)(b)

    329       4,987  

LKQ Corp.

    218       11,955  

Pool Corp.

    76       27,185  

SiteOne Landscape Supply Inc.(a)

    72       10,032  

WW Grainger Inc.

    96       52,179  
   

 

 

 
      149,829  
Diversified Financial Services — 0.8%            

LendingTree Inc.(a)

    8       364  

Mastercard Inc., Class A

    163       57,668  

Visa Inc., Class A(b)

    300       63,633  
   

 

 

 
      121,665  
Entertainment — 1.1%            

AMC Entertainment Holdings Inc., Class A(a)

    1,489       21,680  

Caesars Entertainment Inc.(a)

    524       23,942  

Churchill Downs Inc.

    79       16,574  

Cinemark Holdings Inc.(a)

    256       4,692  

DraftKings Inc., Class A (a)

    476       6,535  

Live Nation Entertainment Inc.(a)

    360       33,836  

Madison Square Garden Sports Corp.(a)

    40       6,151  

Marriott Vacations Worldwide Corp.

    71       9,721  

Penn National Gaming Inc.(a)

    267       9,225  

Red Rock Resorts Inc., Class A

    232       9,125  

Scientific Games Corp., Class A(a)

    88       4,483  

Six Flags Entertainment Corp.(a)

    136       3,083  

Vail Resorts Inc.

    104       24,662  
   

 

 

 
      173,709  
Food — 1.8%            

Beyond Meat Inc.(a)(b)

    67       2,143  

Flowers Foods Inc.

    360       10,228  

Grocery Outlet Holding Corp.(a)

    450       19,224  

Kroger Co. (The)

    3,537       164,258  

Performance Food Group Co.(a)

    308       15,311  

Sprouts Farmers Market Inc.(a)

    504       13,931  

Sysco Corp.

    559       47,459  

U.S. Foods Holding Corp.(a)

    432       13,608  
   

 

 

 
      286,162  
Food Service — 0.1%            

Aramark

    640       21,376  
   

 

 

 

Holding Companies - Diversified — 0.0%

   

Cannae Holdings Inc.(a)

    120       2,533  
   

 

 

 

Home Builders — 0.1%

   

Taylor Morrison Home Corp.(a)

    160       4,592  

Toll Brothers Inc.

    208       10,229  
   

 

 

 
      14,821  
Home Furnishings — 0.1%            

Sleep Number Corp.(a)

    94       4,236  

Tempur Sealy International Inc.

    544       14,949  
   

 

 

 
      19,185  

 

 

S C H E D U L E    O F   I N V E S T M E N T S

  23


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Discretionary Spending ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Household Products & Wares — 0.2%

   

Helen of Troy Ltd.(a)

    41     $ 5,486  

Kimberly-Clark Corp.

    208       27,412  
   

 

 

 
      32,898  
Housewares — 0.1%            

Newell Brands Inc.

    758       15,319  

Scotts Miracle-Gro Co. (The)

    64       5,693  

Tupperware Brands Corp.(a)

    88       656  
   

 

 

 
      21,668  
Internet — 21.4%            

Airbnb Inc., Class A(a)

    855       94,888  

Amazon.com Inc.(a)

    20,480       2,763,776  

Booking Holdings Inc.(a)

    85       164,534  

Cars.com Inc.(a)

    120       1,411  

Chewy Inc., Class A(a)

    181       7,025  

DoorDash Inc., Class A(a)

    618       43,105  

eBay Inc.

    985       47,900  

Etsy Inc.(a)

    232       24,063  

Expedia Group Inc.(a)

    297       31,497  

Groupon Inc.(a)

    48       509  

Just Eat Takeaway.com NV SP ADR(a)(b)

    590       2,136  

Lyft Inc., Class A(a)

    394       5,461  

Match Group Inc.(a)

    76       5,571  

MercadoLibre Inc.(a)(b)

    97       78,930  

Overstock.com Inc.(a)

    100       2,900  

Pinterest Inc., Class A(a)

    1,181       23,006  

Stitch Fix Inc., Class A(a)(b)

    110       657  

Uber Technologies Inc.(a)

    1,829       42,890  

Wayfair Inc., Class A(a)(b)

    329       17,736  
   

 

 

 
          3,357,995  
Leisure Time — 0.6%            

Carnival Corp.(a)

    2,092       18,954  

Norwegian Cruise Line Holdings Ltd.(a)

    730       8,869  

Peloton Interactive Inc., Class A(a)

    581       5,514  

Planet Fitness Inc., Class A(a)

    416       32,785  

Polaris Inc.

    56       6,568  

Royal Caribbean Cruises Ltd.(a)

    313       12,116  

YETI Holdings Inc.(a)

    196       9,951  
   

 

 

 
      94,757  
Lodging — 2.4%            

Boyd Gaming Corp.

    166       9,215  

Choice Hotels International Inc.

    128       15,471  

Hilton Grand Vacations Inc.(a)

    168       6,849  

Hilton Worldwide Holdings Inc.

    886       113,470  

Hyatt Hotels Corp., Class A(a)

    128       10,592  

Las Vegas Sands Corp.(a)

    1,047       39,462  

Marriott International Inc./MD, Class A

    572       90,845  

MGM Resorts International

    885       28,966  

Travel + Leisure Co.

    328       14,140  

Wyndham Hotels & Resorts Inc.

    383       26,584  

Wynn Resorts Ltd.(a)

    200       12,696  
   

 

 

 
      368,290  
Oil & Gas — 0.8%            

ConocoPhillips

    1,260       122,762  
   

 

 

 

Pharmaceuticals — 0.0%

   

Herbalife Nutrition Ltd.(a)

    190       4,638  
   

 

 

 

Real Estate — 0.0%

   

RE/MAX Holdings Inc., Class A

    84       2,129  
   

 

 

 
Security   Shares     Value  

Real Estate Investment Trusts — 0.2%

   

Apple Hospitality REIT Inc.

    336     $ 5,604  

Host Hotels & Resorts Inc.

    1,064       18,950  

Macerich Co. (The)

    203       2,154  

Park Hotels & Resorts Inc.

    240       3,742  

Ruth’s Hospitality Group Inc.

    144       2,527  

Ryman Hospitality Properties Inc.(a)

    64       5,667  
   

 

 

 
      38,644  
Retail — 54.4%            

Abercrombie & Fitch Co., Class A(a)

    415       7,391  

Academy Sports & Outdoors Inc.

    349       15,017  

Advance Auto Parts Inc.

    288       55,763  

American Eagle Outfitters Inc.

    936       11,269  

AutoNation Inc.(a)

    168       19,948  

AutoZone Inc.(a)

    88       188,090  

Bath & Body Works Inc.

    1,255       44,603  

Bed Bath & Beyond Inc.(a)(b)

    771       3,878  

Best Buy Co. Inc.

    849       65,364  

Big Lots Inc.

    248       5,007  

BJ’s Restaurants Inc.(a)

    72       1,690  

BJ’s Wholesale Club Holdings Inc.(a)

    561       37,980  

Bloomin’ Brands Inc.

    384       7,830  

Boot Barn Holdings Inc.(a)

    173       10,778  

Brinker International Inc.(a)

    211       5,855  

Buckle Inc. (The)

    152       4,590  

Burlington Stores Inc.(a)

    363       51,230  

CarMax Inc.(a)(b)

    483       48,078  

Carvana Co., Class A(a)

    210       6,121  

Casey’s General Stores Inc.

    168       34,045  

Cheesecake Factory Inc. (The)

    168       4,911  

Chipotle Mexican Grill Inc.(a)

    92       143,908  

Costco Wholesale Corp.

    2,112           1,143,226  

Cracker Barrel Old Country Store Inc.

    112       10,648  

Darden Restaurants Inc.

    536       66,727  

Dave & Buster’s Entertainment Inc.(a)

    169       6,314  

Dick’s Sporting Goods Inc.

    345       32,289  

Dollar General Corp.

    1,248       310,041  

Dollar Tree Inc.(a)

    1,217       201,243  

Domino’s Pizza Inc.

    166       65,090  

FirstCash Holdings Inc.

    152       11,135  

Five Below Inc.(a)

    312       39,646  

Floor & Decor Holdings Inc., Class A(a)

    437       35,209  

Foot Locker Inc.

    512       14,525  

Freshpet Inc.(a)

    79       4,222  

GameStop Corp., Class A(a)(b)

    976       33,194  

Gap Inc. (The)

    1,672       16,085  

Genuine Parts Co.

    248       37,912  

Home Depot Inc. (The)

    4,191       1,261,240  

Jack in the Box Inc.

    90       6,223  

Kohl’s Corp.

    913       26,605  

La-Z-Boy Inc.

    144       4,013  

Lithia Motors Inc.

    56       14,856  

Lowe’s Companies Inc.

    2,600       497,978  

Lululemon Athletica Inc.(a)

    668       207,421  

Macy’s Inc.

    1,212       21,392  

McDonald’s Corp.

    2,076       546,756  

MSC Industrial Direct Co. Inc., Class A

    80       6,613  

Murphy USA Inc.

    96       27,299  

National Vision Holdings Inc.(a)

    200       5,828  

Nordstrom Inc.

    625       14,694  

Ollie’s Bargain Outlet Holdings Inc.(a)

    326       19,218  

 

 

24  

2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Discretionary Spending ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

 

 

Retail (continued)

   

O’Reilly Automotive Inc.(a)

    319     $ 224,445  

Papa John’s International Inc.

    94       9,014  

PriceSmart Inc.

    112       7,435  

Qurate Retail Inc. Series A

    423       1,155  

RH(a)

    90       25,149  

Ross Stores Inc.

    1,884       153,094  

Sally Beauty Holdings Inc.(a)

    648       8,281  

Shake Shack Inc., Class A(a)

    96       4,940  

Signet Jewelers Ltd.

    323       19,690  

Starbucks Corp.

    2,947       249,847  

Target Corp.

    2,676       437,205  

Texas Roadhouse Inc.

    288       25,119  

TJX Companies Inc. (The)

    5,850       357,786  

Tractor Supply Co.

    551       105,505  

Ulta Beauty, Inc.(a)

    307       119,395  

Victoria’s Secret & Co.(a)

    419       15,486  

Walgreens Boots Alliance Inc.

    1,957       77,536  

Walmart Inc.

    7,028       928,047  

Wendy’s Co. (The)

    680       14,300  

Williams-Sonoma Inc.

    364       52,569  

Wingstop Inc.

    96       12,113  

Yum China Holdings Inc.

    1,372       66,830  

Yum! Brands Inc.

    1,183       144,965  
   

 

 

 
          8,520,894  
Software — 0.2%            

Intuit Inc.

    40       18,247  

Take-Two Interactive Software Inc.(a)

    38       5,044  
   

 

 

 
      23,291  
Textiles — 0.0%            

UniFirst Corp./MA

    32       6,269  
   

 

 

 
Security   Shares     Value  

 

 

Toys, Games & Hobbies — 0.2%

   

Hasbro Inc.

    192     $ 15,114  

Mattel Inc.(a)

    606       14,059  
   

 

 

 
      29,173  
Transportation — 0.5%            

FedEx Corp.

    336       78,318  
   

 

 

 

Total Long-Term Investments — 99.3%
(Cost: $16,394,049)

 

    15,562,463  
   

 

 

 

Short-Term Securities

   

Money Market Funds — 2.3%

   

BlackRock Cash Funds: Institutional, SL Agency Shares, 1.93%(c)(d)(e)

    298,332       298,302  

BlackRock Cash Funds: Treasury, SL Agency Shares, 1.81%(c)(d)

    60,000       60,000  
   

 

 

 

Total Short-Term Securities — 2.3%
(Cost: $358,255)

 

    358,302  
   

 

 

 

Total Investments in Securities — 101.6%
(Cost: $16,752,304)

 

    15,920,765  

Liabilities in Excess of Other Assets — (1.6)%

      (243,835
   

 

 

 

Net Assets — 100.0%

    $   15,676,930  
   

 

 

 

 

(a) 

Non-income producing security.

(b) 

All or a portion of this security is on loan.

(c) 

Affiliate of the Fund.

(d) 

Annualized 7-day yield as of period end.

(e) 

All or a portion of this security was purchased with the cash collateral from loaned securities.

Affiliates

Investments in issuers considered to be affiliate(s) of the Fund during the year ended July 31, 2022 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

 

 
Affiliated Issuer   Value at
07/31/21
    Purchases
at Cost
    Proceeds
from Sale
    Net Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
    Value at
07/31/22
    Shares
Held at
07/31/22
    Income    

Capital

Gain

Distributions

from

Underlying
Funds

 

 

 

BlackRock Cash Funds: Institutional, SL Agency Shares

  $ 168,573     $ 129,943 (a)    $      $ (258   $ 44     $ 298,302       298,332     $ 2,580 (b)    $  

BlackRock Cash Funds: Treasury, SL Agency Shares

    205,000             (145,000 )(a)                  60,000       60,000       236        
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 
         $ (258   $ 44     $ 358,302       $ 2,816     $  
       

 

 

   

 

 

   

 

 

     

 

 

   

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 
  (b)

All or a portion represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees and collateral investment expenses, and other payments to and from borrowers of securities.

 

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.

 

 

S C H E D U L E    O F   I N V E S T M E N T S

  25


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Discretionary Spending ETF

 

Fair Value Hierarchy as of Period End (continued)

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.

 

                                                                               

 

 
     Level 1        Level 2        Level 3        Total  

 

 

Investments

                 

Assets

                 

Common Stocks

   $ 15,562,463        $        $        $ 15,562,463  

Money Market Funds

     358,302                            358,302  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 15,920,765        $        $        $ 15,920,765  
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

26  

2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  

July 31, 2022

  

iShares® Evolved U.S. Financials ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   

Banks — 39.9%

   

Ameris Bancorp.

    64     $ 3,027  

Associated Banc-Corp.

    521       10,472  

Atlantic Union Bankshares Corp.

    210       7,264  

BancFirst Corp.

    70       7,517  

Bank of America Corp.

    10,235       346,045  

Bank of Hawaii Corp.

    142       11,376  

Bank of New York Mellon Corp. (The)

    1,789       77,750  

Bank OZK

    340       13,634  

BankUnited Inc.

    187       7,265  

Banner Corp.

    52       3,223  

BOK Financial Corp.

    79       6,954  

Cathay General Bancorp

    270       11,259  

Citigroup Inc.

    3,929           203,915  

Citizens Financial Group Inc.

    1,335       50,690  

City Holding Co.

    40       3,472  

Columbia Banking System Inc.

    153       4,616  

Comerica Inc.

    396       30,797  

Commerce Bancshares Inc.

    318       22,098  

Community Bank System Inc.

    114       7,676  

ConnectOne Bancorp. Inc.

    114       3,014  

Cullen/Frost Bankers Inc.

    178       23,211  

CVB Financial Corp.

    243       6,481  

Eagle Bancorp. Inc.

    67       3,285  

East West Bancorp. Inc.

    396       28,425  

Eastern Bankshares Inc.

    423       8,629  

Enterprise Financial Services Corp.

    88       4,139  

Fifth Third Bancorp.

    1,921       65,545  

First BanCorp./Puerto Rico

    372       5,613  

First Bancorp./Southern Pines NC

    71       2,689  

First Busey Corp.

    168       4,141  

First Citizens BancShares Inc./NC, Class A

    31       23,457  

First Commonwealth Financial Corp.

    268       3,972  

First Financial Bancorp

    210       4,691  

First Financial Bankshares Inc.

    426       18,821  

First Hawaiian Inc.

    391       9,967  

First Horizon Corp.

    1,609       35,977  

First Interstate BancSystem Inc., Class A

    231       9,420  

Flagstar Bancorp. Inc.

    62       2,554  

FNB Corp.

    1,043       12,474  

Fulton Financial Corp.

    574       9,580  

Glacier Bancorp. Inc.

    258       12,923  

Goldman Sachs Group Inc. (The)

    784       261,378  

Hancock Whitney Corp.

    253       12,349  

Hanmi Financial Corp.

    78       1,971  

Heartland Financial USA Inc.

    107       4,804  

Heritage Financial Corp./WA

    75       1,952  

Hilltop Holdings Inc.

    240       6,924  

Home BancShares Inc./AR

    478       11,281  

Hope Bancorp Inc.

    282       4,241  

Huntington Bancshares Inc./OH

    3,984       52,947  

Independent Bank Corp.

    89       7,458  

Independent Bank Group Inc.

    54       3,819  

International Bancshares Corp.

    202       8,860  

JPMorgan Chase & Co.

    3,027       349,195  

KeyCorp.

    2,758       50,471  

Lakeland Bancorp. Inc.

    198       3,152  

Lakeland Financial Corp.

    67       5,213  

Live Oak Bancshares Inc.

    83       3,124  
Security   Shares     Value  

Banks (continued)

   

M&T Bank Corp.

    339     $ 60,156  

Morgan Stanley

    3,064       258,295  

National Bank Holdings Corp., Class A

    71       2,955  

NBT Bancorp. Inc.

    113       4,581  

Northern Trust Corp.

    526       52,484  

OFG Bancorp

    94       2,582  

Old National Bancorp./IN

    589       10,255  

PacWest Bancorp

    343       9,614  

Park National Corp.

    33       4,275  

Pathward Financial Inc.

    57       1,922  

Pinnacle Financial Partners Inc.

    221       17,481  

Popular Inc.

    234       18,175  

Prosperity Bancshares Inc.

    259       19,189  

Regions Financial Corp.

    2,663       56,402  

Renasant Corp.

    114       3,808  

S&T Bancorp. Inc.

    84       2,599  

Sandy Spring Bancorp. Inc.

    118       4,873  

Seacoast Banking Corp. of Florida

    99       3,542  

ServisFirst Bancshares Inc.

    142       12,134  

Silvergate Capital Corp., Class A(a)

    104       9,702  

Simmons First National Corp., Class A

    177       4,204  

Southside Bancshares Inc.

    85       3,395  

SouthState Corp.

    199       16,869  

State Street Corp.

    895       63,581  

SVB Financial Group(a)

    159       64,164  

Synovus Financial Corp.

    445       17,969  

Texas Capital Bancshares Inc.(a)

    82       4,807  

Tompkins Financial Corp.

    58       4,475  

Triumph Bancorp. Inc.(a)

    35       2,543  

Truist Financial Corp.

    3,562       179,774  

Trustmark Corp.

    72       2,338  

U.S. Bancorp

    3,607       170,250  

UMB Financial Corp.

    142       12,851  

Umpqua Holdings Corp.

    598       10,531  

United Bankshares Inc./WV

    363       14,063  

United Community Banks Inc./GA

    128       4,356  

Valley National Bancorp

    892       10,428  

Veritex Holdings Inc.

    64       1,980  

Walker & Dunlop Inc.

    54       6,083  

Webster Financial Corp.

    592       27,498  

Wells Fargo & Co.

    8,574       376,141  

WesBanco Inc.

    155       5,289  

Westamerica Bancorp

    61       3,661  

Western Alliance Bancorp

    203       15,505  

Wintrust Financial Corp.

    174       14,971  

Zions Bancorp. NA

    490       26,730  
   

 

 

 
        3,536,677  
Commercial Services — 4.2%            

Automatic Data Processing Inc.

    268       64,620  

Equifax Inc.

    118       24,651  

Euronet Worldwide Inc.(a)

    37       3,636  

EVERTEC Inc.

    100       3,899  

FleetCor Technologies Inc.(a)

    58       12,765  

FTI Consulting Inc.(a)

    31       5,070  

Global Payments Inc.

    235       28,745  

Grand Canyon Education Inc.(a)

    35       3,363  

Green Dot Corp., Class A(a)

    57       1,602  

HealthEquity Inc.(a)

    55       3,199  

Insperity Inc.

    43       4,719  

MarketAxess Holdings Inc.

    43       11,644  

 

 

S C H E D U L E   O F   I N V E S T M E N T S

  27


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Financials ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Commercial Services (continued)

   

Moody’s Corp.

    196     $ 60,809  

Morningstar Inc.

    25       6,384  

S&P Global Inc.

    210       79,155  

Service Corp. International

    167       12,435  

Verisk Analytics Inc.

    191       36,338  

WEX Inc.(a)

    37       6,150  
   

 

 

 
            369,184  
Computers — 0.1%            

Genpact Ltd.

    100       4,808  
   

 

 

 

Diversified Financial Services — 16.9%

   

Affiliated Managers Group Inc.

    91       11,501  

Ally Financial Inc.

    686       22,686  

American Express Co.

    1,139       175,429  

Ameriprise Financial Inc.

    281       75,847  

Apollo Global Management Inc.

    998       56,986  

Ares Management Corp., Class A

    207       14,832  

Artisan Partners Asset Management Inc., Class A

    106       4,215  

BGC Partners Inc., Class A

    325       1,186  

Bread Financial Holdings Inc.

    30       1,188  

Capital One Financial Corp.

    1,006       110,489  

Cboe Global Markets Inc.

    151       18,630  

Charles Schwab Corp. (The)

    3,572       246,647  

CME Group Inc.

    336       67,025  

Cohen & Steers Inc.

    54       3,979  

Credit Acceptance Corp.(a)

    24       13,822  

Discover Financial Services

    559       56,459  

Evercore Inc., Class A

    58       5,798  

Federated Hermes Inc.

    198       6,754  

Franklin Resources Inc.

    558       15,317  

Hamilton Lane Inc., Class A

    36       2,720  

Houlihan Lokey Inc.

    60       5,074  

Interactive Brokers Group Inc., Class A

    107       6,280  

Intercontinental Exchange Inc.

    658       67,109  

Invesco Ltd.

    504       8,941  

Janus Henderson Group PLC

    418       10,772  

Jefferies Financial Group Inc.

    367       11,953  

KKR & Co. Inc.

    1,058       58,677  

LendingClub Corp.(a)

    248       3,435  

LendingTree Inc.(a)

    7       319  

LPL Financial Holdings Inc.

    156       32,747  

Mastercard Inc., Class A

    92       32,549  

Moelis & Co., Class A

    61       2,841  

Mr Cooper Group Inc.(a)

    133       5,992  

Nasdaq Inc.

    157       28,401  

Navient Corp.

    407       6,703  

OneMain Holdings Inc.

    174       6,473  

PennyMac Financial Services Inc.

    100       5,479  

Piper Sandler Cos.

    37       4,669  

Radian Group Inc.

    481       10,760  

Raymond James Financial Inc.

    466       45,887  

SEI Investments Co.

    229       12,677  

SLM Corp.

    931       14,524  

SoFi Technologies Inc.(a)

    383       2,417  

Stifel Financial Corp.

    276       16,508  

Synchrony Financial

    1,061       35,522  

T Rowe Price Group Inc.

    407       50,252  

Tradeweb Markets Inc., Class A

    82       5,783  

Upstart Holdings Inc.(a)

    91       2,214  

Virtu Financial Inc., Class A

    151       3,523  
Security   Shares     Value  

Diversified Financial Services (continued)

   

Virtus Investment Partners Inc.

    17     $ 3,507  

Visa Inc., Class A

    378       80,178  

Western Union Co. (The)

    432       7,353  
   

 

 

 
      1,501,029  
Electric — 0.1%            

Hawaiian Electric Industries Inc.

    209       8,841  
   

 

 

 

Engineering & Construction — 0.0%

   

frontdoor Inc.(a)

    83       2,222  
   

 

 

 

Forest Products & Paper — 0.2%

   

International Paper Co.

    329       14,071  

Sylvamo Corp.

    29       1,138  
   

 

 

 
      15,209  
Health Care - Services — 4.1%            

Centene Corp.(a)

    163       15,154  

Elevance Health Inc.

    180       85,878  

Humana Inc.

    7       3,374  

Molina Healthcare Inc.(a)

    42       13,764  

UnitedHealth Group Inc.

    445       241,342  
   

 

 

 
          359,512  
Home Builders — 0.2%            

MDC Holdings Inc.

    76       2,755  

NVR Inc.(a)

    4       17,572  
   

 

 

 
      20,327  
Household Products & Wares — 0.0%            

Spectrum Brands Holdings Inc.

    12       835  
   

 

 

 

Insurance — 24.7%

   

Aflac Inc.

    1,692       96,952  

Alleghany Corp.(a)

    40       33,499  

Allstate Corp. (The)

    714       83,517  

American Financial Group Inc./OH

    209       27,939  

American International Group Inc.

    2,236       115,758  

Aon PLC, Class A

    259       75,379  

Arch Capital Group Ltd.

    845       37,518  

Argo Group International Holdings Ltd.

    84       2,754  

Arthur J Gallagher & Co.

    413       73,923  

Assurant Inc.

    89       15,644  

Assured Guaranty Ltd.

    127       7,416  

Axis Capital Holdings Ltd.

    202       10,199  

Berkshire Hathaway Inc., Class B(a)

    965       290,079  

Brighthouse Financial Inc.(a)

    232       10,073  

Brown & Brown Inc.

    497       32,355  

Cincinnati Financial Corp.

    415       40,396  

CNA Financial Corp.

    100       4,242  

CNO Financial Group Inc.

    313       5,869  

Employers Holdings Inc.

    56       2,224  

Enstar Group Ltd.(a)

    29       5,740  

Equitable Holdings Inc.

    904       25,701  

Erie Indemnity Co., Class A, NVS

    41       8,338  

Essent Group Ltd.

    275       11,484  

Everest Re Group Ltd.

    107       27,964  

Fidelity National Financial Inc.

    624       24,935  

First American Financial Corp.

    286       16,588  

Genworth Financial Inc., Class A(a)

    1,014       4,310  

Globe Life Inc.

    280       28,204  

Hanover Insurance Group Inc. (The)

    121       16,513  

Hartford Financial Services Group Inc. (The)

    955       61,569  

Horace Mann Educators Corp.

    85       2,911  

 

 

28  

2 0 2 2   I S H A R E S   A N N U A L   R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2022

  

iShares® Evolved U.S. Financials ETF

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

 

 

Insurance (continued)

   

James River Group Holdings Ltd.

    48     $ 1,140  

Kemper Corp.

    181       8,471  

Kinsale Capital Group Inc.

    59       14,349  

Lincoln National Corp.

    510       26,183  

Loews Corp.

    319       18,582  

Markel Corp.(a)

    29       37,617  

Marsh & McLennan Companies Inc.

    947       155,270  

Mercury General Corp.

    90       3,774  

MetLife Inc.

    1,090       68,943  

MGIC Investment Corp.

    979       13,843  

NMI Holdings Inc., Class A(a)

    209       3,958  

Old Republic International Corp.

    569       13,241  

Palomar Holdings Inc.(a)

    59       3,680  

Primerica Inc.

    84       10,810  

Principal Financial Group Inc.

    755       50,540  

ProAssurance Corp.

    105       2,324  

Progressive Corp. (The)

    1,529       175,927  

Prudential Financial Inc.

    1,066       106,589  

RenaissanceRe Holdings Ltd.

    113       14,612  

RLI Corp.

    136       14,957  

Safety Insurance Group Inc.

    33       2,856  

Selective Insurance Group Inc.

    168       13,080  

Travelers Companies Inc. (The)

    655       103,949  

Trupanion Inc.(a)

    37       2,332  

Universal Insurance Holdings Inc.

    64       810  

Unum Group

    592       19,056  

Voya Financial Inc.

    319       19,191  

W R Berkley Corp.

    591       36,955  

White Mountains Insurance Group Ltd.

    10       12,394  

Willis Towers Watson PLC

    182       37,663  
   

 

 

 
        2,193,089  
Leisure Time — 0.0%            

Harley-Davidson Inc.

    119       4,499  
   

 

 

 

Machinery — 1.2%

   

Caterpillar Inc.

    518       102,694  

Vertiv Holdings Co.

    294       3,357  
   

 

 

 
      106,051  
Media — 0.2%            

FactSet Research Systems Inc.

    24       10,312  

New York Times Co. (The), Class A

    218       6,965  
   

 

 

 
      17,277  
Packaging & Containers — 0.1%            

Berry Global Group Inc.(a)

    99       5,707