iShares Trust

·  iShares Asia 50 ETF | AIA | NASDAQ

·  iShares Blockchain and Tech ETF | IBLC | NYSE Arca

·  iShares Emerging Markets Infrastructure ETF | EMIF | NASDAQ

·  iShares Europe ETF | IEV | NYSE Arca

·  iShares Future Metaverse Tech and Communications ETF | IVRS | NYSE Arca

·  iShares India 50 ETF | INDY | NASDAQ

·  iShares International Developed Property ETF | WPS | NYSE Arca

·  iShares International Developed Small Cap Value Factor ETF | ISVL | Cboe BZX

·  iShares International Dividend Growth ETF | IGRO | Cboe BZX

·  iShares Latin America 40 ETF | ILF | NYSE Arca

Table of Contents

Market Overview

iShares Trust

Global Market Overview

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

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

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

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

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

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

Investment Objective

The iShares Asia 50 ETF (the “Fund”) seeks to track the investment results of an index composed of 50 of the largest Asian equities, as represented by the S&P Asia 50^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

Expense Example

Portfolio Management Commentary

Large-capitalization stocks in Asia declined significantly for the reporting period, pressured by higher interest rates. South Korean stocks detracted the most from the Index’s return in an environment of stalling economic growth. The South Korean economy slowed in the first half of the reporting period before contracting in the fourth quarter of 2022 amid normalizing consumer spending patterns and declining exports. Inflation was elevated, although it remained lower than in many other developed economies and decelerated by the end of the reporting period. In response to inflation, the Bank of Korea raised interest rates multiple times, pressuring stocks. The South Korean won also declined relative to the U.S. dollar, reducing the value of South Korean equities in U.S. dollar terms.

The South Korean information technology sector was the largest source of weakness, led by the technology hardware, storage, and peripherals industry. A sharp decline in demand for smartphones worked against the industry, driving a significant decline in earnings. Softer pricing for memory chips also dented the industry’s profitability. Stocks in the communication services sector also declined, as the interactive media and services industry faced slower growth in advertising revenue.

Taiwanese stocks also detracted from the Index’s performance. Taiwan’s economy contracted on an annual basis in the fourth quarter of 2022, stifled by declining exports. The economy of China, Taiwan’s largest trading partner, was slowed by strict lockdowns to prevent the spread of COVID-19, disrupting many Taiwanese businesses. The Taiwanese information technology sector declined the most, primarily the semiconductors and semiconductor equipment industry. As supply chains and spending patterns recovered from the coronavirus pandemic, global demand for semiconductors cooled significantly, pressuring the outlook for the industry. New U.S. restrictions on certain technology sales to China disrupted investment plans in the industry.

Chinese stocks also declined, driven by the internet and direct marketing retail industry in the consumer discretionary sector. Profitability in the industry was constrained by government restrictions and heightened competition among e-retailers.

Portfolio Information

Investment Objective

The iShares Blockchain and Tech ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. companies that are involved in the development, innovation, and utilization of blockchain and crypto technologies; as represented by the NYSE FactSet Global Blockchain Technologies Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSETVALUE)

The inception date of the Fund was April 25, 2022. The first day of secondary market trading was April 27, 2022.

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

Expense Example

Portfolio Management Commentary

The blockchain industry contracted significantly in 2022, in contrast to the exponential growth of preceding years. In particular, investor confidence in cryptocurrencies and digital assets —which underpin the model of decentralized finance that blockchain technology supports —dissipated amid a series of high-profile business failures. The collapse of an algorithmically powered stablecoin, an asset intended to maintain a 1:1 peg with the U.S. dollar, created significant ripple effects across the industry, leading to the demise of a major hedge fund and multiple lenders. The revelation of large-scale fraud within a major U.S. cryptocurrency exchange further weakened confidence, sending asset prices sharply lower.

At the same time, the sharp rise in interest rates offered investors of digital assets the opportunity to earn higher yields on other securities deemed less volatile, such as U.S. Treasuries. As gold prices climbed and cryptocurrencies dropped amid high inflation, investors were increasingly skeptical of bitcoin’s appeal over the precious metal as a store of value. This sentiment, along with ongoing volatility in the cryptocurrency markets, fueled an exodus of assets away from decentralized finance.

Profitability among bitcoin miners, or companies that devote extensive computing power to solving mathematical equations to generate cryptocurrencies, fell substantially as operating costs climbed and the market value of the assets fell. Cryptocurrency exchanges reported a sizable reduction in trading activity, which substantially decreased revenues and profits. Venture capital funding for blockchain and cryptocurrency projects also slowed. U.S. regulators took enforcement actions against multiple cryptocurrency businesses. Citing a lack of regulatory clarity and increased scrutiny, a handful of cryptocurrency companies closed U.S. business units.

Signs of a recovery emerged later in the reporting period, as digital asset and blockchain technology stocks climbed from their lowest prices, and investors returned. Blockchain technology continued to help businesses achieve tangible operational benefits beyond their current infrastructures. Technology conglomerates also announced efforts to broaden blockchain usage among enterprises and governments. The E.U. advanced measures to create a clear and comprehensive set of operating guidelines for cryptocurrency companies in the region.

Portfolio Information

Investment Objective

The iShares Emerging Markets Infrastructure ETF (the “Fund”) seeks to track the investment results of an index composed of 30 of the largest equities in the emerging markets infrastructure industry, as represented by the S&P Emerging Markets Infrastructure Index^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

Expense Example

Portfolio Management Commentary

Infrastructure stocks in emerging markets declined for the reporting period amid volatility due to slowing economic growth, high global inflation, and concerns about the impact of rising interest rates. During the reporting period, rising energy prices in the wake of Russia’s invasion of Ukraine, as well as turmoil in the global banking system, were headwinds for emerging market infrastructure stocks. A slowdown in global inflation and China’s shift away from COVID-19 pandemic restrictions generally helped the Index’s performance later in the reporting period.

Utilities stocks in China detracted the most from the Index’s return. The country’s reopening from pandemic restrictions, along with government subsidies to renewable energy firms, were tailwinds for the sector. However, large renewable electricity stocks declined amid weak demand and relatively high industry-wide debt as many firms awaited overdue green energy subsidies promised by the central government. In addition, higher coal prices reduced profitability for companies distributing power generated from coal-fired plants.

Stocks in Brazil also detracted from the Index’s return. Electric utilities stocks fell as a change in the country’s presidential administration cast doubt on the industry’s recent privatization. Oil and gas storage and transportation stocks also declined, reflecting a surge in oil prices early in the reporting period and high debt levels that clouded credit rating outlooks.

Conversely, stocks of airport services firms in Mexico contributed to the Index’s return. North American companies, responding to supply-chain difficulties that surfaced during the pandemic, returned more of their production base closer to home. The country’s increased travel tied to that environment benefited the industry’s stocks. Overall, air travel in Mexico finally returned to pre-pandemic levels. Passenger traffic rose 5% in the first 11 months of 2022 compared with the same time frame in 2019. The increase, in part, reflected fewer U.S. border restrictions with Mexico beginning in late 2021 and a large influx of international workers.

Portfolio Information

Investment Objective

The iShares Europe ETF (the “Fund”) seeks to track the investment results of an index composed of European equities, as represented by the S&P Europe 350^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

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

Expense Example

Portfolio Management Commentary

European stocks rose modestly during the reporting period as companies navigated an array of economic and business challenges, including stubbornly high inflation, the ongoing war in Ukraine, COVID-19 lockdowns in China, and a Swiss banking crisis. French stocks contributed the most to the Index’s return as surging consumer demand for luxury goods benefited companies in the consumer discretionary sector. Textile and apparel makers added new jobs and increased shareholder dividends. Sales at the world’s largest luxury group topped pre-pandemic levels as affluent Americans, buoyed by the strong U.S. dollar, returned to spending on international travel and luxury goods such as jewelry and luggage. Demand from U.S. and European consumers also drove sales of beauty products and helped offset rising input costs and the impact of China’s slowdown. A strong recovery in oil demand and the ongoing restriction on supply stemming from Russia’s war in Ukraine aided profits of French energy companies.

Danish stocks also contributed to the Index’s return, with pharmaceuticals companies leading returns. Demand for a new medicine for obesity outstripped supply in the U.S. and delayed its entry into many European markets. Sales of the drug increased operating profits of the drug’s developer and boosted the stock’s price.

On the downside, pharmaceuticals stocks in Switzerland were the largest detractors from the Index’s return, as the receding pandemic reduced demand for COVID-19 products. The failure of a highly anticipated Alzheimer’s drug to slow the onset of the disease in clinical trials disappointed investors, sending stock prices lower. Bank stocks were also notable detractors from the Index’s return after the near-collapse of a prominent Swiss bank shook investor confidence, leading to a government-structured deal with a rival lender. Swiss consumer staples stocks also detracted from the Index’s return as packaged foods companies reported lower sales volumes despite moves to offset higher raw material costs by increasing the prices of consumer goods.

Portfolio Information

Investment Objective

The iShares Future Metaverse Tech and Communications ETF (the “Fund”) seeks to track the investment results of an index composed of U.S. and non-U.S. companies that provide products and services that are expected to contribute to the metaverse in areas including virtual platforms, social media, gaming, 3D software, digital assets, and virtual and augmented reality, as represented by the Morningstar Global Metaverse & Virtual Interaction Select Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

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

The inception date of the Fund was February 14, 2023. The first day of secondary market trading was February 16, 2023.

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

Expense Example

Portfolio Information

Investment Objective

The iShares India 50 ETF (the “Fund”) seeks to track the investment results of an index composed of 50 of the largest Indian equities, as represented by the Nifty 50 Index (the “Index”) and determined by the Index provider, NSE Indices Ltd. The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

Expense Example

Portfolio Management Commentary

Large-capitalization Indian stocks declined for the reporting period amid slowing economic growth and rising interest rates. While India’s economy continued to recover from the effects of the coronavirus pandemic, the rate of growth slowed on an annual basis in the second half of 2022 as the effect of pent-up consumer demand faded and manufacturing growth stalled. Rising interest rates also weighed on the economy, and the Reserve Bank of India increased its headline interest rate multiple times during the reporting period. While inflation was substantial, it was not significantly higher than India’s historical average and showed signs of easing as the reporting period continued. The Indian rupee declined notably relative to the U.S. dollar, reducing the value of equities held in U.S. dollar terms.

Higher oil and gas prices following Russia’s invasion of Ukraine initially had a negative impact on India, which is a large net-importer of energy commodities. However, India benefited from falling prices thereafter and was able to negotiate discounts on Russian oil that were below standard market prices. India’s exports grew, particularly exports of services, which helped to offset weaker growth in goods exports.

The Indian labor market was tepid, as unemployment remained high even as the economy continued to grow. The labor force participation rate stayed relatively low, indicating that many Indians, particularly young workers, stopped looking for work entirely. Nonetheless, consumer spending rose as economic activity continued to return to normal, sustaining the country’s economic growth.

A high-profile report from a U.S.-based finance firm accusing a large Indian conglomerate of fraud and market manipulation negatively impacted India’s stock market. The report led to intensified investor scrutiny of Indian companies associated with the conglomerate, driving a decline in Indian equities overall. However, the conglomerate vigorously contested the accusations, and an investigation by the Securities and Exchange Board of India had not released any findings by the end of the reporting period. The government’s business-friendly financial reforms helped attract investors to Indian markets.

Portfolio Information

Investment Objective

The iShares International Developed Property ETF (the “Fund”) seeks to track the investment results of an index composed of real estate equities in developed non-U.S. markets, as represented by the S&P Developed ex-U.S. Property IndexTM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

Expense Example

Portfolio Management Commentary

International developed property stocks declined significantly during the reporting period amid a slowing global economy, elevated inflation, and sharply higher interest rates. German stocks were the largest detractors from the Index’s performance, led by equity real estate investment trusts (“REITs”). Rising interest rates drove a downturn in the real estate market in Germany, as property financing and mortgages became more expensive. Transactions in the German commercial real estate market declined significantly amid pricing uncertainty and the economic impact of Russia’s invasion of Ukraine.

German real estate operating companies were negatively affected by government action against a prominent company in the industry. German authorities raided the offices of the company and prosecutors alleged that illegal kickbacks were made in the awarding of contracts to subcontractors. While the investigation was still ongoing at the end of the reporting period, the high-profile accusations drove a significant decline in the industry.

The U.K. diversified REIT industry was another notable source of detraction from the Index’s return. Interest rates rose rapidly in the U.K. and the Bank of England was one of the first major central banks to raise interest rates. Consequently, borrowing costs rose significantly for firms investing in the U.K. property market, weighing on profitability. The deteriorating economic outlook and high interest rates led to a devaluation of some properties in the industry, while elevated inflation drove operating costs sharply higher.

Despite facing a different macroeconomic backdrop, Japanese diversified REITs also declined. Inflation was lower in Japan than in most other major economies, and the Bank of Japan (“BOJ”) held interest rates steady, keeping its key short-term interest rate in negative territory. Nonetheless, investor concerns about pressure on the BOJ to increase interest rates and modify its yield curve control policy weighed on the industry.

Diversified REITs in Australia were another source of weakness, declining amid a downturn in the real estate market. Higher interest rates and economic uncertainty negatively impacted the tenants of some warehouses and industrial properties, which in turn pressured REITs that own these properties.

Portfolio Information

Investment Objective

The iShares International Developed Small Cap Value Factor ETF (the “Fund”) seeks to track the investment results of an index composed of international developed market small-capitalization stocks, excluding the U.S. and Korea, with prominent value characteristics, as represented by the FTSE Developed ex US ex Korea Small Cap Focused Value Index (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSETVALUE)

The inception date of the Fund was March 23, 2021. The first day of secondary market trading was March 25, 2021.

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

Expense Example

Portfolio Management Commentary

International developed market small-capitalization stocks with prominent value characteristics declined for the reporting period amid a slowing global economy, elevated inflation, and high interest rates. U.K. stocks were the largest detractors from the Index’s performance, led by diversified real estate investment trusts (“REITs”). As interest rates edged higher, borrowing costs for firms investing in the U.K. rose significantly, squeezing profit margins and shrinking budgets. The deteriorating outlook and changing post-pandemic consumer shopping habits lowered rental income and decreased demand for warehouse properties. A sharp rise in yields also prompted property investors to cycle away from REITs in favor of government bonds.

Diversified REITs in Australia detracted from the Index’s performance amid a broader downturn in the real estate market. Higher interest rates and economic uncertainty negatively impacted the tenants of some commercial and industrial properties, which in turn pressured the REITs that own these properties. Companies involved in residential communities reported lower earnings and fewer deal closings due to labor shortages, construction delays, and rising inflation.

Canadian REIT stocks also detracted from the Index’s return as real estate stocks traded sharply lower following multiple interest rate hikes by the Bank of Canada. Commercial real estate companies reported delays in new lease agreements as clients weighed recession fears. Financials companies also detracted from the Index’s return amid high inflation and a challenging capital markets environment.

Conversely, Japanese stocks were significant contributors to the Index’s return. Steel makers raised prices to offset increased production costs and expanded into more profitable business lines, benefiting industrials stocks. Consumer discretionary companies gained as Japan reopened to foreigners and retail sales increased, particularly in the luxury watch market. Lastly, rising bank fees and higher interest rates proved profitable for Italian banks, driving contribution from Italian financials.

The Index’s selection process is designed to maximize exposure to small-capitalization stocks with prominent value characteristics, with screens to eliminate stocks with low liquidity, high volatility, high debt, negative sentiment, and negative momentum. Reflecting those constraints, the Index outperformed the broader market, as represented by the FTSE Developed ex US ex Korea Small Cap Focused Value Index. The value factor tends to perform relatively well during economic environments with high inflation and rising interest rates due in part to value’s lower-interest rate sensitivity and shorter-dated cash flows. Stock selection in the U.K., Japan, and Germany also contributed.

Portfolio Information

Investment Objective

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

Performance

GROWTH OF $10,000 INVESTMENT

(SINCE INCEPTION AT NET ASSET VALUE)

The inception date of the Fund was May 17, 2016. The first day of secondary market trading was May 19, 2016.

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

Expense Example

Portfolio Management Commentary

Dividend stocks outside the U.S. declined amid rapidly rising interest rates and a weakening global economy. As central banks around the world raised interest rates, bond yields rose significantly. Dividend-bearing stocks are typically negatively impacted by higher yields, since higher income from bonds makes those investments relatively more attractive to income-seeking investors. Nonetheless, some investors viewed dividend-paying stocks as being more resilient in an economic downturn.

Canadian stocks led the decline, as bank stocks in the financials sector faced significant headwinds. Canada’s economic growth slowed during the reporting period, and the worsening economy drove an increase in provisions for loan losses at banks. A substantial payment to settle claims surrounding a large bank’s involvement with a fraudulent investment scheme also weighed on the banking industry. However, improved net interest margins amid rising interest rates helped the industry offset some of the negative impacts to income.

Swiss stocks also detracted from the Index’s performance, most notably in the healthcare sector. Pharmaceuticals companies faced declining demand for COVID-19 treatments and diagnostic testing kits as vaccinations against the virus expanded. Increased competition from several biosimilar cancer treatment drugs, which have similar active properties as older licensed drugs, also weakened sales.

In China, weakness in the financials sector detracted from performance, particularly in the banking industry. Investors’ concerns about exposure of banks to troubled Chinese property developers pressured the industry.

On the upside, Danish stocks contributed to the Index’s return, buoyed by the pharmaceuticals industry in the healthcare sector. The industry benefited from soaring sales and profits from a new anti-obesity drug, outstripping projections. However, the high costs of the drug, lack of insurance coverage, and production delays limited sales growth.

Spanish and French high-dividend stocks also gained. In Spain, the utilities sector benefited from its foreign operations, as strong profits from North and South America helped to offset a decline domestically. In France, the successful trial of a drug to treat pulmonary disease supported the pharmaceuticals industry in the healthcare sector.

Portfolio Information

Investment Objective

The iShares Latin America 40 ETF (the “Fund”) seeks to track the investment results of an index composed of 40 of the largest Latin American equities, as represented by the S&P Latin America 40^TM (the “Index”). The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index.

Performance

GROWTH OF $10,000 INVESTMENT

(AT NET ASSET VALUE)

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

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

Expense Example

Portfolio Management Commentary

Large-capitalization Latin American stocks declined significantly for the reporting period amid high inflation and tighter monetary policy. Brazil was the largest detractor from the Index’s return, as economic growth in the country faltered. Rising borrowing costs weakened the Brazilian economy, which slowed before finally contracting in the fourth quarter of 2022. The central bank of Brazil raised interest rates multiple times in response to elevated inflation and prices fell substantially over the course of the reporting period. The Brazilian real declined relative to the U.S. dollar amid tightening U.S. monetary policy and fiscal concerns in Brazil, reducing the value of Brazilian stocks in U.S. dollar terms.

The Brazilian financials sector was a significant source of weakness, particularly the banking industry. The worsening economic environment in Brazil weakened bank profits, as consumers’ reduced purchasing power drove an increase in expenses from delinquent loans expected to go unpaid. Rising operating costs also dented earnings in the banking industry. Brazil’s materials sector also detracted, as the metals and mining industry faced volatile prices for iron ore and fines for safety practices related to a dam collapse. Furthermore, high rainfall and equipment maintenance needs led to a reduction in iron ore production late in 2022. The consumer staples sector also declined, as an oversupply of poultry and high costs weighed on profitability in the packaged foods and meats industry.

Colombian stocks also detracted from the Index’s performance in an environment of tepid economic growth. Equities in Colombia faced headwinds following a presidential election and a new administration perceived by some investors as less business friendly. The financials sector declined the most, as inflation rose during the reporting period, pressuring bank customers’ purchasing power and ability to repay loans.

On the upside, Mexican stocks contributed slightly to the Index’s performance. Despite slow economic growth, unemployment dropped to the lowest rate in 20 years, and inflation began to decelerate. The Mexican banking industry benefited from an influx of new customers relocating factories closer to the U.S.

Portfolio Information

About Fund Performance

Past performance is not an indication of future results. Financial markets have experienced extreme volatility and trading in many instruments has been disrupted. These circumstances may continue for an extended period of time and may continue to affect adversely the value and liquidity of each Fund’s investments. As a result, current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end is available at iShares.com. Performance results assume reinvestment of all dividends and capital gain distributions and do not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares. The investment return and principal value of shares will vary with changes in market conditions. Shares may be worth more or less than their original cost when they are redeemed or sold in the market. Performance for certain funds may reflect a waiver of a portion of investment advisory fees. Without such a waiver, performance would have been lower.

Net asset value or “NAV” is the value of one share of a fund as calculated in accordance with the standard formula for valuing mutual fund shares. Beginning August 10, 2020, the price used to calculate market return (“Market Price”) is the closing price. Prior to August 10, 2020, Market Price was determined using the midpoint between the highest bid and the lowest ask on the primary stock exchange on which shares of a fund are listed for trading, as of the time that such fund’s NAV is calculated. Since shares of a fund may not trade in the secondary market until after the fund’s inception, for the period from inception to the first day of secondary market trading in shares of the fund, the NAV of the fund is used as a proxy for the Market Price to calculate market returns. Market and NAV returns assume that dividends and capital gain distributions have been reinvested at Market Price and NAV, respectively.

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

Disclosure of Expenses

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

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

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

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