ANNUAL REPORT

December 31, 2023

	T. ROWE PRICE
TDVG	Dividend Growth ETF
	For more insights from T. Rowe Price investment professionals, go to troweprice.com.

INVEST WITH CONFIDENCE^®

T. ROWE PRICE DIVIDEND GROWTH ETF

HIGHLIGHTS

■	Despite posting significant positive absolute returns, the Dividend Growth Fund underperformed the benchmark S&P 500 Index and its peer group, the Lipper Large-Cap Core Funds Index, for the 12-month period ended December 31, 2023.
■	Underperformance was concentrated in three sectors that led benchmark returns—information technology, consumer discretionary, and communication services. Our dividend growth mandate prevents us from owning many high-performing names in those sectors, providing significant headwinds to relative performance. Against the style-specific Nasdaq US Dividend Achievers Index, however, we outperformed for the year due to stock selection, demonstrating the strength of our bottom-up process within our investable universe.
■	We continue to seek compelling risk/reward opportunities, with the information technology sector our largest on an absolute basis, followed by health care and industrials and business services.
■	Our preference is for high-quality companies with durable growth traits. We continue to build positions in companies with compelling risk/reward profiles and strong dividend growth prospects on a multiyear view.

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T. ROWE PRICE DIVIDEND GROWTH ETF

Market Commentary

Dear Shareholder

Global stock and bond indexes were broadly positive during 2023 as most economies managed to avoid the recession that was widely predicted at the start of the year. Technology companies benefited from investor enthusiasm for artificial intelligence developments and led the equity rally, while fixed income benchmarks rebounded late in the year amid falling interest rates.

For the 12-month period, the technology-oriented Nasdaq Composite Index rose about 43%, reaching a record high and producing the strongest result of the major benchmarks. Growth stocks outperformed value shares, and developed market stocks generally outpaced their emerging markets counterparts. Currency movements were mixed over the period, although a weaker dollar versus major European currencies was beneficial for U.S. investors in European securities.

Within the S& P 500 Index, which finished the year just short of the record level it reached in early 2022, the information technology, communication services, and consumer discretionary sectors were all lifted by the tech rally and recorded significant gains. A small group of tech-oriented mega-cap companies helped drive much of the market’s advance. Conversely, the defensive utilities sector had the weakest returns in the growth-focused environment, and the energy sector also lost ground amid declining oil prices. The financials sector bounced back from the failure of three large regional banks in the spring and was one of the top-performing segments in the second half of the year.

The U.S. economy was the strongest among the major markets during the period, with gross domestic product growth coming in at 4.9% in the third quarter, the highest since the end of 2021. Corporate fundamentals were also broadly supportive. Year-over-year earnings growth contracted in the first and second quarters of 2023, but results were better than expected, and earnings growth turned positive again in the third quarter. Markets remained resilient despite a debt ceiling standoff in the U.S., the outbreak of war in the Middle East, the continuing conflict between Russia and Ukraine, and a sluggish economic recovery in China.

Inflation remained a concern, but investors were encouraged by the slowing pace of price increases as well as the possibility that the Federal Reserve was nearing the end of its rate-hiking cycle. The Fed held rates steady after raising its short-term lending benchmark rate to a target range of 5.25% to 5.50% in July,

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the highest level since March 2001, and at its final meeting of the year in December, the central bank indicated that there could be three 25-basis-point rate cuts in 2024.

The yield of the benchmark 10-year U.S. Treasury note briefly reached 5.00% in October for the first time since late 2007 before falling back to 3.88% by period-end, the same level where it started the year, amid cooler-than-expected inflation readings and less-hawkish Fed rhetoric. Fixed income benchmarks were lifted late in the year by falling yields. Investment-grade and high yield corporate bonds produced solid returns, supported by the higher coupons that have become available over the past year, as well as increasing hopes that the economy might be able to avoid a recession.

Global economies and markets showed surprising resilience in 2023, but considerable uncertainty remains as we look ahead. Geopolitical events, the path of monetary policy, and the impact of the Fed’s rate hikes on the economy all raise the potential for additional volatility. We believe this environment makes skilled active management a critical tool for identifying risks and opportunities, and our investment teams will continue to use fundamental research to help identify securities that can add value to your portfolio over the long term.

Thank you for your continued confidence in T. Rowe Price.

Sincerely,

Robert Sharps

CEO and President

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Management’s Discussion of Fund Performance

INVESTMENT OBJECTIVE

The fund seeks dividend income and long-term capital growth.

FUND COMMENTARY

How did the fund perform in the past 12 months?

The Dividend Growth ETF returned 13.69% for the 12-month period ended December 31, 2023. The fund underperformed its primary benchmark, the S&P 500 Index, and its peer group, the Lipper Large-Cap Core Funds Index. The fund also underperformed its peer group in the Morningstar Large Blend category. The fund outperformed its style-specific, dividend-growth-focused benchmark, the Nasdaq US Broad Dividend Achievers Index. (Past performance cannot guarantee future results.)

The fund’s Board of Directors declared an annual dividend of $0.1323 per share on December 20, 2023. Dividend distributions for the year to date totaled $0.4626 per share. Shareholders should have already received a check or statement reflecting these distributions.

PERFORMANCE COMPARISON

T. ROWE PRICE DIVIDEND GROWTH ETF

What factors influenced the fund’s performance?

U.S. equities climbed in 2023, as measured by the S&P 500 Index, which climbed 26.29%. Our style-specific benchmark, the Nasdaq US Broad Dividend Achievers Index, advanced by 11.88%, demonstrating the challenging relative environment for dividend growers. Early in the period, enthusiasm over the proliferation of generative artificial intelligence (AI) pushed mega-cap, tech-levered names higher in a narrow market. Later in the year, favorable economic data signaled to investors that restrictive monetary policy may stabilize or ease, pushing equities higher as the year closed.

While the portfolio participated with strong absolute returns, extremely narrow market leadership was a headwind for relative performance against the broad market benchmark as high-beta, growth-oriented companies led the way, particularly non-dividend-paying big tech companies, most of which we do not own given our dividend growth mandate. Against the style-specific benchmark, however, the portfolio outperformed largely due to favorable stock selection. Our focus remains on buying and holding high-quality companies that have strong balance sheets, durable cash flow generation, and increasing dividends, and we remain confident that our strategy has the potential to generate strong risk-adjusted returns.

An underweight allocation in information technology detracted, as did stock choices in the sector. A large portion of sector performance within the broad market benchmark was concentrated in select names that either pay no dividend or pay a nominal one that does not fit our investment criteria for dividend commitment, creating an outsized impact on portfolio performance. Not owning NVIDIA, one of the largest beneficiaries of AI enthusiasm, detracted. Our position in Texas Instruments, the market leader in analog and mixed-signal semiconductors, detracted as shares advanced but did not keep pace with the broader sector. We view it as one of the highest-quality companies in its space, with an attractive track record of long-term capital management. We believe the compounding effects of its competitive advantages have the potential to drive free cash flow growth over the long term. Stock selection added value against the style-specific benchmark, however, demonstrating the quality of our holdings in our investable universe. (Please refer to the portfolio of investments for a complete list of holdings and the amount each represents in the portfolio.)

In the consumer discretionary sector, unfavorable stock selection weighed on returns. A pair of non-dividend-paying companies that do not meet our investment criteria—Tesla and Amazon.com—led returns in the sector. Our position in Ross Stores, which provides a compelling mix of name brand and designer apparel and home fashion at price points that resonate strongly with

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value-conscious consumers, detracted from relative returns. Shares advanced as low-end consumer spending trends normalized, but performance lagged sector peers. We like the company for its position in the attractive off-price retail segment, as well as its strong balance sheet. Against our style-specific benchmark, stock selection boosted relative returns, further demonstrating the strength of our bottom-up process within our investable universe.

Our underweight position in the communication services sector also pulled down relative returns. Many companies within the sector do not pay a dividend or meet our investment criteria, and one of them—Meta Platforms, parent company of Facebook—led sector returns.

Conversely, stock choices within industrials and business services added value. Our position in General Electric boosted relative returns as the spinoff of GE’s health care segment cleaned up the existing company’s balance sheet, improved performance in its energy segment, and provided visibility to the promise of its aerospace division. We believe the upside potential of the aerospace division as well as the self-help potential in its power business could launch an attractive multiyear growth trajectory, while the improved post-spinoff balance sheet could help the company deliver more value to shareholders as performance improves. The sector also led relative returns against the style-specific benchmark.

An average underweight to the energy sector also boosted relative returns during the period as the sector ended lower given falling oil and natural gas prices. Over the course of the year, we shifted our underweight to a modest overweight given a shift in our structural long-term energy view and improving capital allocation practices within the sector. We continue to seek companies in the space with strong balance sheets and favorable capital allocation structures.

How is the fund positioned?

As shown in the Sector Diversification table, the fund’s largest allocations at the end of the period were in information technology, health care, financials, and industrials and business services. These are sectors where we believe we can find high-quality companies with sustainable competitive advantages, durable business models, attractive valuations, and potential for strong dividend growth.

The portfolio’s largest purchasing activity during the year came in energy, adding exposure to a space we feel is undergoing structural productivity changes. We initiated a position in Schlumberger, the global leader in oil field services. Schlumberger is a technological leader in its field with attractive scale and a strong reputation for performance, and we believe the company has the potential to be a beneficiary of the ongoing international capital expenditure exploration

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cycle, which could continue for several years, particularly internationally, where the company makes most of its revenue. We also added a position in EQT, the largest producer of natural gas in the U.S., as a high-quality way to increase exposure to the commodity where we feel fundamentals have improved.

We also added to our holdings in information technology, increasing our exposure to AI capabilities through names that fit our dividend growth criteria. We made significant additions within the semiconductor industry, including a recent initiation in Analog Devices, a high-quality analog consolidator. We view it as one of the best companies in its space, with a high-value product portfolio with attractive end markets and underappreciated free cash flow potential. Elsewhere in the industry, we added shares of Applied Materials, Microchip Technology, and KLA Corp. In our view, these companies have the potential for

SECTOR DIVERSIFICATION

T. ROWE PRICE DIVIDEND GROWTH ETF

durable growth due to their product lines and also boast attractive shareholder return profiles. We also added to a pair of top portfolio holdings within the sector in Microsoft and Apple.

Elsewhere in the portfolio, we found pockets of opportunities to increase our positions in select areas, adding to durable, high-quality companies with compelling risk/reward profiles and strong multiyear dividend growth prospects. In many cases, these companies have already experienced their periods of weakness, which are priced into valuation and thus create meaningful upside for the portfolio as fundamentals improve. We added positions in McKesson, the largest North American drug distributor and a distributor of ambulatory medical/surgical supplies with a focus on the oncology ecosystem and biopharma manufacturer services, as well as Target, an above-average retailer that offers compelling value to its customers backed by its strong merchandising and omnichannel operations.

Several other recent positions fit into this theme. In the second half of the year, we initiated positions in T-Mobile US, the large U.S. wireless carrier with, in our view, the best management team and shareholder alignment in its industry, and CSX, a railroad that executes well in a strong industry backdrop with attractive dividend growth potential. We also added to our existing position in Colgate-Palmolive, the world’s leading oral care products provider, as it utilizes pricing power and volume improvements to potentially unlock shareholder value.

Our largest net sales came in the financials sector. We eliminated our positions in CME Group, a diversified futures exchange, and Fidelity National Information Services, a global payment processor, when risk/reward and growth prospects turned unfavorable. We used proceeds from the sales to fund more attractive ideas elsewhere in the portfolio.

What is portfolio management’s outlook?

As we begin 2024, market sentiment is the exact opposite of 2023, when everyone was bearish and the market surged. Following a strong, valuation-driven market in 2023, and with bullish sentiment and expectations for a soft landing prevalent, the risk could be to the downside should a less-than-perfect scenario unfold.

A combination of slower expected earnings growth and higher long-term interest rates is not consistent with multiple expansion or the continued outperformance of long duration stocks. It is challenging to see a scenario in which we get a repeat of the S&P 500’s stellar return, driven by just a handful of names and multiple expansion. Our expectation is for more muted market

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returns going forward but with broader market participation. This is a time to be selective, with our expectation being for an environment that once again rewards fundamentals. We believe this should provide a more positive backdrop for dividend growth as a category moving forward.

As always, our focus remains on buying and holding high-quality companies that have strong balance sheets, durable cash flow generation, and increasing dividends that have proven to compound value over time. While there will be periods of time when dividend growers outperform and others when they underperform, over time, they have outperformed and, importantly, done so with lower volatility.

The views expressed reflect the opinions of T. Rowe Price as of the date of this report and are subject to change based on changes in market, economic, or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

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RISKS OF STOCK INVESTING

A fund’s share price can fall because of weakness in the stock or bond markets, a particular industry, or specific holdings. Stock markets can decline for many reasons, including adverse political or economic developments, changes in investor psychology, or heavy institutional selling. The prospects for an industry or company may deteriorate because of a variety of factors, including disappointing earnings or changes in the competitive environment. In addition, the investment manager’s assessment of companies held in a fund may prove incorrect, resulting in losses or poor performance even in rising markets. Funds investing in stocks with a dividend orientation may have somewhat lower potential for price appreciation than those concentrating on rapidly growing firms. Also, a company may reduce or eliminate its dividend.

BENCHMARK INFORMATION

Note: Lipper, a Thomson Reuters Company, is the source for all Lipper content reflected in these materials. Copyright 2024 © Refinitiv. All rights reserved. Any copying, republication or redistribution of Lipper content is expressly prohibited without the prior written consent of Lipper. Lipper shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Note: The Nasdaq Broad Dividend Achievers Index is composed of U.S. accepted securities with at least 10 consecutive years of increasing annual regular dividend payments.

Note: ©2024, S&P Global Market Intelligence. Reproduction of any information, data or material, including ratings (Content) in any form is prohibited except with the prior written permission of the relevant party. Such party, its affiliates and suppliers (Content Providers) do not guarantee the accuracy, adequacy, completeness, timeliness or availability of any Content and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such Content. In no event shall Content Providers be liable for any damages, costs, expenses, legal fees, or losses (including lost income or lost profit and opportunity costs) in connection with any use of the Content.

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PORTFOLIO HIGHLIGHTS

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GROWTH OF $10,000

This chart shows the value of a hypothetical $10,000 investment in the fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records). The result is compared with benchmarks, which include a broad-based market index and may also include a peer group average or index. Market indexes do not include expenses, which are deducted from fund returns as well as mutual fund averages and indexes.

Note: See the Average Annual Compound Total Return table.

*Since 8/31/20.

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AVERAGE ANNUAL COMPOUND TOTAL RETURN

PREMIUM/DISCOUNT INFORMATION

The frequency at which the daily market prices were at a discount or premium to the fund’s net asset value is available on the fund’s website (troweprice.com).

EXPENSE RATIO

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FUND EXPENSE EXAMPLE

As a shareholder, you may incur two types of costs: (1) transaction costs, such as brokerage commissions on purchases and sales, and (2) ongoing costs, including management fees and other fund expenses. The following example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other funds. The example is based on an investment of $1,000 invested at the beginning of the most recent six-month period and held for the entire period.

Actual Expenses

The first line of the following table (Actual) provides information about actual account values and expenses based on the fund’s actual returns. You may use the information on this line, together with your account balance, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The information on the second line of the table (Hypothetical) is based on hypothetical account values and expenses derived from the fund’s actual expense ratio and an assumed 5% per year rate of return before expenses (not the fund’s actual return). You may compare the ongoing costs of investing in the fund with other funds by contrasting this 5% hypothetical example and the 5% hypothetical examples that appear in the shareholder reports of the other funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period.

You should also be aware that the expenses shown in the table highlight only your ongoing costs and do not reflect any transaction costs, such as brokerage commissions paid on purchases and sales of shares. Therefore, the second line of the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. To the extent a fund charges transaction costs, however, the total cost of owning that fund is higher.

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FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

---

	Year Ended			8/4/20 (1) Through
	12/31/23	12/31/22	12/31/21	12/31/20
NET ASSET VALUE
Beginning of period	$  31.41	$  35.32	$  28.26	$  25.00
Investment activities
Net investment income(2) (3)	0.47	0.42	0.33	0.14
Net realized and unrealized gain/loss	3.79	(3.97)	7.01	3.24
Total from investment activities	4.26	(3.55)	7.34	3.38
Distributions
Net investment income	(0.46)	(0.36)	(0.28)	(0.12)
NET ASSET VALUE
End of period	$  35.21	$  31.41	$  35.32	$ 28.26
Ratios/Supplemental Data
Total return, based on NAV(3) (4)	13.69%	(10.02)%	26.09%	13.52%
Ratios to average net assets:(3)
Gross expenses before waivers/payments by Price Associates	0.50%	0.50%	0.50%	0.50% (5)
Net expenses after waivers/payments by Price Associates	0.50%	0.50%	0.50%	0.50% (5)
Net investment income	1.43%	1.34%	1.01%	1.31% (5)
Portfolio turnover rate(6)	18.0%	18.3%	12.1%	6.7%
Net assets, end of period (in thousands)	$ 349,479	$ 272,133	$ 126,811	$  37,020

    

(1)	Inception date
(2)	Per share amounts calculated using average shares outstanding method.
(3)	See Note 6 for details to expense-related arrangements with Price Associates.
(4)	Total return reflects the rate that an investor would have earned on an investment in the fund during each period, assuming reinvestment of all distributions. Total return is not annualized for periods less than one year.
(5)	Annualized
(6)	Portfolio turnover excludes securities received or delivered through in-kind share transactions.

The accompanying notes are an integral part of these financial statements.

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December 31, 2023

PORTFOLIO OF INVESTMENTS‡	Shares	$ Value
(Cost and value in $000s)
COMMON STOCKS 96.8%
COMMUNICATION SERVICES 0.6%
Entertainment 0.0%
Walt Disney	961	87
		87
Wireless Telecommunication Services 0.6%
T-Mobile US	11,964	1,918
		1,918
Total Communication Services		2,005
CONSUMER DISCRETIONARY 7.2%
Hotels Restaurants & Leisure 3.7%
Hilton Worldwide Holdings	23,896	4,351
Las Vegas Sands	28,385	1,397
Marriott International, Class A	4,540	1,024
McDonald's	13,252	3,929
Yum! Brands	15,342	2,005
		12,706
Specialty Retail 3.0%
Home Depot	12,875	4,462
Ross Stores	34,285	4,745
Tractor Supply	6,163	1,325
		10,532
Textiles, Apparel & Luxury Goods 0.5%
NIKE, Class B	16,544	1,796
		1,796
Total Consumer Discretionary		25,034

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	Shares	$ Value
(Cost and value in $000s)
CONSUMER STAPLES 9.0%
Beverages 2.5%
Coca-Cola	65,240	3,845
Constellation Brands, Class A	6,372	1,540
Diageo, ADR	532	78
PepsiCo	20,408	3,466
		8,929
Consumer Staples Distribution & Retail 2.4%
Costco Wholesale	3,234	2,135
Dollar General	7,055	959
Target	12,456	1,774
Walmart	22,321	3,519
		8,387
Food Products 1.6%
Mondelez International, Class A	76,163	5,516
		5,516
Household Products 1.2%
Colgate-Palmolive	51,661	4,118
		4,118
Personal Care Products 0.4%
Kenvue	69,774	1,502
		1,502
Tobacco 0.9%
Philip Morris International	33,127	3,116
		3,116
Total Consumer Staples		31,568

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	Shares	$ Value
(Cost and value in $000s)
ENERGY 4.2%
Energy Equipment & Services 1.0%
Schlumberger	66,792	3,476
		3,476
Oil, Gas & Consumable Fuels 3.2%
EOG Resources	25,118	3,038
EQT	48,964	1,893
Exxon Mobil	41,542	4,153
TotalEnergies, ADR (1)	12,000	809
Williams	35,892	1,250
		11,143
Total Energy		14,619
FINANCIALS 15.5%
Banks 3.8%
Bank of America	116,477	3,922
JPMorgan Chase	38,561	6,559
Wells Fargo	56,837	2,797
		13,278
Capital Markets 3.2%
Charles Schwab	54,974	3,782
Goldman Sachs Group	4,498	1,735
Morgan Stanley	39,396	3,674
S&P Global	4,426	1,950
		11,141
Consumer Finance 0.9%
American Express	17,316	3,244
		3,244

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	Shares	$ Value
(Cost and value in $000s)
Financial Services 2.2%
Visa, Class A	29,559	7,696
		7,696
Insurance 5.4%
Aon, Class A	6,750	1,964
Chubb	28,659	6,477
Hartford Financial Services Group	25,424	2,044
Marsh & McLennan	30,428	5,765
Progressive	15,518	2,472
		18,722
Total Financials		54,081
HEALTH CARE 16.4%
Biotechnology 0.9%
AbbVie	20,128	3,119
		3,119
Health Care Equipment & Supplies 2.9%
Becton Dickinson	15,390	3,753
GE HealthCare Technologies	25,286	1,955
Medtronic	9,194	757
Stryker	12,195	3,652
		10,117
Health Care Providers & Services 4.9%
Cigna	6,036	1,808
Elevance Health	5,987	2,823
McKesson	10,956	5,072
UnitedHealth Group	13,947	7,343
		17,046
Life Sciences Tools & Services 3.5%
Agilent Technologies	21,886	3,044

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	Shares	$ Value
(Cost and value in $000s)
Danaher	16,961	3,924
Thermo Fisher Scientific	10,209	5,419
		12,387
Pharmaceuticals 4.2%
AstraZeneca, ADR	55,145	3,714
Eli Lilly	8,869	5,170
Johnson & Johnson	14,586	2,286
Zoetis	17,293	3,413
		14,583
Total Health Care		57,252
INDUSTRIALS & BUSINESS SERVICES 15.4%
Aerospace & Defense 1.8%
Howmet Aerospace	52,620	2,848
Northrop Grumman	7,725	3,616
		6,464
Building Products 0.6%
Trane Technologies	8,792	2,144
		2,144
Commercial Services & Supplies 1.2%
Veralto	5,799	477
Waste Connections	25,133	3,752
		4,229
Ground Transportation 2.8%
CSX	52,800	1,831
JB Hunt Transport Services	8,758	1,749
Old Dominion Freight Line	5,612	2,275
Union Pacific	15,312	3,761
		9,616

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	Shares	$ Value
(Cost and value in $000s)
Industrial Conglomerates 4.8%
General Electric	49,185	6,278
Honeywell International	24,259	5,087
Roper Technologies	10,253	5,590
		16,955
Machinery 2.0%
Cummins	6,042	1,448
Illinois Tool Works	6,926	1,814
Otis Worldwide	19,665	1,759
Stanley Black & Decker	20,206	1,982
		7,003
Professional Services 2.2%
Automatic Data Processing	7,864	1,832
Broadridge Financial Solutions	20,735	4,266
Equifax	5,798	1,434
		7,532
Total Industrials & Business Services		53,943
INFORMATION TECHNOLOGY 19.5%
Electronic Equipment, Instruments & Components 2.0%
Amphenol, Class A	40,318	3,997
TE Connectivity	20,081	2,821
		6,818
IT Services 1.9%
Accenture, Class A	19,211	6,741
		6,741
Semiconductors & Semiconductor Equipment 4.7%
Analog Devices	8,200	1,628
Applied Materials	22,835	3,701
KLA	7,330	4,261

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	Shares	$ Value
(Cost and value in $000s)
Microchip Technology	32,141	2,899
QUALCOMM	10,056	1,454
Texas Instruments	14,665	2,500
		16,443
Software 6.4%
Microsoft	59,936	22,538
		22,538
Technology Hardware, Storage & Peripherals 4.5%
Apple	81,634	15,716
		15,716
Total Information Technology		68,256
MATERIALS 4.0%
Chemicals 2.9%
Air Products & Chemicals	5,342	1,463
Linde	10,801	4,436
Nutrien	9,162	516
RPM International	9,383	1,047
Sherwin-Williams	8,527	2,660
		10,122
Containers & Packaging 1.1%
Avery Dennison	14,128	2,856
Ball	18,685	1,075
		3,931
Total Materials		14,053
REAL ESTATE 2.5%
Industrial REITs 0.5%
Rexford Industrial Realty, REIT	33,590	1,884
		1,884

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	Shares	$ Value
(Cost and value in $000s)
Residential REITs 1.0%
Equity Residential, REIT	55,605	3,401
		3,401
Specialized REITs 1.0%
American Tower, REIT	15,654	3,379
		3,379
Total Real Estate		8,664
UTILITIES 2.5%
Electric Utilities 0.3%
NextEra Energy	20,506	1,246
		1,246
Gas Utilities 0.5%
Atmos Energy	14,236	1,650
		1,650
Multi-Utilities 1.7%
Ameren	33,467	2,421
CMS Energy	35,911	2,085
WEC Energy Group	15,732	1,324
		5,830
Total Utilities		8,726
Total Common Stocks (Cost $297,386)		338,201
SHORT-TERM INVESTMENTS 3.1%
Money Market Funds 3.1%
State Street Institutional U.S. Government Money Market Fund, 5.32% (2)	10,878,775	10,879
Total Short-Term Investments (Cost $10,879)		10,879

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T. ROWE PRICE DIVIDEND GROWTH ETF

	Shares	$ Value
(Cost and value in $000s)
SECURITIES LENDING COLLATERAL 0.2%
Investments in a Pooled Account through Securities Lending Program with State Street Bank 0.2%
Money Market Funds 0.2%
T. Rowe Price Government Reserve Fund, 5.42% (2)(3)	736,786	737
Total Investments in a Pooled Account through Securities Lending Program with State Street Bank		737
Total Securities Lending Collateral (Cost $737)		737
Total Investments in Securities 100.1% of Net Assets (Cost $309,002)		$349,817

    

‡	Shares are denominated in U.S. dollars unless otherwise noted.
(1)	All or a portion of this security is on loan at December 31, 2023. See Note 3.
(2)	Seven-day yield
(3)	Affiliated Companies
ADR	American Depositary Receipts
REIT	A domestic Real Estate Investment Trust whose distributions pass-through with original tax character to the shareholder

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T. ROWE PRICE DIVIDEND GROWTH ETF

AFFILIATED COMPANIES

($000s)

The fund may invest in certain securities that are considered affiliated companies. As defined by the 1940 Act, an affiliated company is one in which the fund owns 5% or more of the outstanding voting securities, or a company that is under common ownership or control. The following securities were considered affiliated companies for all or some portion of the year ended December 31, 2023. Net realized gain (loss), investment income, change in net unrealized gain/loss, and purchase and sales cost reflect all activity for the period then ended.

Affiliate	Net Realized Gain (Loss)	Changes in Net Unrealized Gain/Loss	Investment Income
T. Rowe Price Government Reserve Fund	$ —	$—	$—++
Totals	$—#	$—	$ —+

    

Supplementary Investment Schedule
Affiliate	Value 12/31/22	Purchase Cost	Sales Cost	Value 12/31/23
T. Rowe Price Government Reserve Fund	$ —	¤	¤	$ 737
	Total			$737^

    

++	Excludes earnings on securities lending collateral, which are subject to rebates and fees as described in Note 3.
#	Capital gain distributions from mutual funds represented $0 of the net realized gain (loss).
+	Investment income comprised $0 of dividend income and $0 of interest income.
¤	Purchase and sale information not shown for cash management funds.
^	The cost basis of investments in affiliated companies was $737.

The accompanying notes are an integral part of these financial statements.

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T. ROWE PRICE DIVIDEND GROWTH ETF

December 31, 2023

     STATEMENT OF ASSETS AND LIABILITIES    

($000s, except shares and per share amounts)

Assets
Investments in securities, at value (cost $309,002)	$ 349,817
Receivable for shares sold	1,409
Dividends receivable	509
Total assets	351,735
Liabilities
Payable for investment securities purchased	1,374
Obligation to return securities lending collateral	737
Investment management and administrative fees payable	145
Total liabilities	2,256
NET ASSETS	$ 349,479
Net assets consists of:
Total distributable earnings (loss)	$ 26,946
Paid-in capital applicable to 9,925,000 shares of $0.0001 par value capital stock outstanding; 4,000,000,000 shares authorized	322,533
NET ASSETS	$349,479
NET ASSET VALUE PER SHARE	$ 35.21

The accompanying notes are an integral part of these financial statements.

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T. ROWE PRICE DIVIDEND GROWTH ETF

     STATEMENT OF OPERATIONS    

($000s)

	Year Ended
	12/31/23
Investment Income (Loss)
Income
Dividend (net of foreign taxes of $18)	$ 6,012
Securities lending	14
Total income	6,026
Investment management and administrative expense	1,564
Net investment income	4,462
Realized and Unrealized Gain / Loss
Net realized gain (loss)
Securities	(9,764)
In-kind redemptions	12,100
Net realized gain	2,336
Change in net unrealized gain / loss on securities	34,315
Net realized and unrealized gain / loss	36,651
INCREASE IN NET ASSETS FROM OPERATIONS	$41,113

The accompanying notes are an integral part of these financial statements.

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T. ROWE PRICE DIVIDEND GROWTH ETF

     STATEMENT OF CHANGES IN NET ASSETS    

($000s)

	Year Ended
	12/31/23		12/31/22
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 4,462		$ 2,111
Net realized gain (loss)	2,336		(343)
Change in net unrealized gain / loss	34,315		(13,699)
Increase (decrease) in net assets from operations	41,113		(11,931)
Distributions to shareholders
Net earnings	(4,421)		(2,105)
Capital share transactions*
Shares sold	124,983		179,600
Shares redeemed	(84,329)		(20,242)
Increase in net assets from capital share transactions	40,654		159,358
Net Assets
Increase during period	77,346		145,322
Beginning of period	272,133		126,811
End of period	$349,479		$272,133
*Share information
Shares sold	3,830		5,705
Shares redeemed	(2,570)		(630)
Increase in shares outstanding	1,260		5,075

The accompanying notes are an integral part of these financial statements.

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T. ROWE PRICE DIVIDEND GROWTH ETF

     NOTES TO FINANCIAL STATEMENTS    

T. Rowe Price Exchange-Traded Funds, Inc. (the corporation) is registered under the Investment Company Act of 1940 (the 1940 Act). The Dividend Growth ETF (the fund) is a diversified, open-end management investment company established by the corporation. The fund seeks dividend income and long-term capital growth.

The fund is considered an actively-managed exchange-traded fund (ETF) that does not disclose its portfolio holdings daily, which is different from a traditional ETF and may create additional risks. In order to provide market participants with information on the fund’s investments, the fund publishes a “Proxy Portfolio” on its website daily. A Proxy Portfolio is a basket of securities that is designed to closely track the daily performance of the fund’s portfolio holdings. While the Proxy Portfolio includes some of the fund’s holdings, it is not the fund’s actual portfolio. The fund does disclose its full portfolio holdings on a quarterly basis, similar to mutual funds.

NOTE  1  –   SIGNIFICANT ACCOUNTING POLICIES

Basis of Preparation

The fund is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 (ASC 946). The accompanying financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (GAAP), including, but not limited to, ASC 946. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity.

Investment Transactions, Investment Income, and Distributions

Investment transactions are accounted for on the trade date basis. Income and expenses are recorded on the accrual basis. Realized gains and losses are reported on the identified cost basis. Income tax-related interest and penalties, if incurred, are recorded as income tax expense. Dividends received from other investment companies are reflected as dividend income; capital gain distributions are reflected as realized gain/loss. Dividend income and capital gain distributions are recorded on the ex-dividend date. Distributions from REITs are initially recorded as dividend income and, to the extent such represent a return of capital or capital gain for tax purposes, are reclassified when such information becomes available. Non-cash dividends, if any, are recorded at the fair market value of the asset

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received. Proceeds from litigation payments, if any, are included in either net realized gain (loss) or change in net unrealized gain/loss from securities. Distributions to shareholders are recorded on the ex-dividend date. Income distributions, if any, are declared and paid quarterly. A capital gain distribution, if any, may also be declared and paid by the fund annually. Dividends and distributions cannot be automatically reinvested in additional shares of the fund.

Capital Transactions

The fund issues and redeems shares at its net asset value (NAV) only with Authorized Participants and only in large blocks of 5,000 shares (each, a “Creation Unit”). The fund’s NAV per share is computed at the close of the New York Stock Exchange (NYSE). However, the NAV per share may be calculated at a time other than the normal close of the NYSE if trading on the NYSE is restricted, if the NYSE closes earlier, or as may be permitted by the SEC. Individual fund shares may not be purchased or redeemed directly with the fund. An Authorized Participant may purchase or redeem a Creation Unit of the fund each business day that the fund is open in exchange for the delivery of a designated portfolio of in-kind securities and/or cash. When purchasing or redeeming Creation Units, Authorized Participants are also required to pay a fixed and/or variable purchase or redemption transaction fee as well as any applicable additional variable charge to defray the transaction cost to a fund.

Individual fund shares may be purchased and sold only on a national securities exchange through brokers. Shares are listed for trading on NYSE Arca, Inc. (NYSE Arca) and because the shares will trade at market prices rather than NAV, shares may trade at prices greater than NAV (at a premium), at NAV, or less than NAV (at a discount). The fund’s shares are ordinarily valued as of the close of regular trading (normally 4:00 p.m. Eastern time) on each day that the NYSE Arca is open.

New Accounting Guidance

In June 2022, the FASB issued Accounting Standards Update (ASU), ASU 2022-03, Fair Value Measurement (Topic 820) – Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments under this ASU are effective for fiscal years beginning after December 15, 2023; however, the fund opted to early adopt, as permitted, effective December 1, 2022. Adoption of the guidance did not have a material impact on the fund’s financial statements.

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T. ROWE PRICE DIVIDEND GROWTH ETF

Indemnification

In the normal course of business, the fund may provide indemnification in connection with its officers and directors, service providers, and/or private company investments. The fund’s maximum exposure under these arrangements is unknown; however, the risk of material loss is currently considered to be remote.

NOTE  2  –   VALUATION

Fair Value

The fund’s financial instruments are valued at the close of the NYSE and are reported at fair value, which GAAP defines as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fund’s Board of Directors (the Board) has designated T. Rowe Price Associates, Inc. as the fund’s valuation designee (Valuation Designee). Subject to oversight by the Board, the Valuation Designee performs the following functions in performing fair value determinations: assesses and manages valuation risks; establishes and applies fair value methodologies; tests fair value methodologies; and evaluates pricing vendors and pricing agents. The duties and responsibilities of the Valuation Designee are performed by its Valuation Committee. The Valuation Designee provides periodic reporting to the Board on valuation matters.

Various valuation techniques and inputs are used to determine the fair value of financial instruments. GAAP establishes the following fair value hierarchy that categorizes the inputs used to measure fair value:

Level 1  –  quoted prices (unadjusted) in active markets for identical financial instruments that the fund can access at the reporting date

Level 2  –  inputs other than Level 1 quoted prices that are observable, either directly or indirectly (including, but not limited to, quoted prices for similar financial instruments in active markets, quoted prices for identical or similar financial instruments in inactive markets, interest rates and yield curves, implied volatilities, and credit spreads)

Level 3  –  unobservable inputs (including the Valuation Designee’s assumptions in determining fair value)

Observable inputs are developed using market data, such as publicly available information about actual events or transactions, and reflect the assumptions that market participants would use to price the financial instrument. Unobservable inputs are those for which market data are not available and are developed using the best information available about

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the assumptions that market participants would use to price the financial instrument. GAAP requires valuation techniques to maximize the use of relevant observable inputs and minimize the use of unobservable inputs. When multiple inputs are used to derive fair value, the financial instrument is assigned to the level within the fair value hierarchy based on the lowest-level input that is significant to the fair value of the financial instrument. Input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level but rather the degree of judgment used in determining those values.

Valuation Techniques

Equity securities, including exchange-traded funds, listed or regularly traded on a securities exchange or in the over-the-counter (OTC) market are valued at the last quoted sale price or, for certain markets, the official closing price at the time the valuations are made. A security that is listed or traded on more than one exchange is valued at the quotation on the exchange determined to be the primary market for such security. Listed securities not traded on a particular day are valued at the mean of the closing bid and asked prices for domestic securities.

Investments in mutual funds are valued at the mutual fund’s closing NAV per share on the day of valuation. Assets and liabilities other than financial instruments, including short-term receivables and payables, are carried at cost, or estimated realizable value, if less, which approximates fair value.

Investments for which market quotations are not readily available or deemed unreliable are valued at fair value as determined in good faith by the Valuation Designee. The Valuation Designee has adopted methodologies for determining the fair value of investments for which market quotations are not readily available or deemed unreliable, including the use of other pricing sources. Factors used in determining fair value vary by type of investment and may include market or investment specific considerations. The Valuation Designee typically will afford greatest weight to actual prices in arm’s length transactions, to the extent they represent orderly transactions between market participants, transaction information can be reliably obtained, and prices are deemed representative of fair value. However, the Valuation Designee may also consider other valuation methods such as market-based valuation multiples; a discount or premium from market value of a similar, freely traded security of the same issuer; discounted cash flows; yield to maturity; or some combination. Fair value determinations are reviewed on a regular basis. Because any fair value determination involves a significant amount of judgment, there is a degree of subjectivity inherent in such pricing decisions. Fair value prices determined by the Valuation Designee could differ from those of other market participants, and it is possible that the fair value determined for a security may be materially different from the value that could be realized upon the sale of that security.

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T. ROWE PRICE DIVIDEND GROWTH ETF

Valuation Inputs

On December 31, 2023, all of the fund’s financial instruments were classified as Level 1, based on the inputs used to determine their fair values.

NOTE  3  –   OTHER INVESTMENT TRANSACTIONS

Consistent with its investment objective, the fund engages in the following practices to manage exposure to certain risks and/or to enhance performance. The investment objective, policies, program, and risk factors of the fund are described more fully in the fund’s prospectus and Statement of Additional Information.

Securities Lending

The fund may lend its securities to approved borrowers to earn additional income. Its securities lending activities are administered by a lending agent in accordance with a securities lending agreement. Security loans generally do not have stated maturity dates, and the fund may recall a security at any time. The fund receives collateral in the form of cash or U.S. government securities. Collateral is maintained over the life of the loan in an amount not less than the value of loaned securities; any additional collateral required due to changes in security values is delivered to the fund the next business day. Cash collateral is invested in accordance with investment guidelines approved by fund management. Additionally, the lending agent indemnifies the fund against losses resulting from borrower default. Although risk is mitigated by the collateral and indemnification, the fund could experience a delay in recovering its securities and a possible loss of income or value if the borrower fails to return the securities, collateral investments decline in value, and the lending agent fails to perform. Securities lending revenue consists of earnings on invested collateral and borrowing fees, net of any rebates to the borrower, compensation to the lending agent, and other administrative costs. In accordance with GAAP, investments made with cash collateral are reflected in the accompanying financial statements, but collateral received in the form of securities is not. At December 31, 2023, the value of loaned securities was $725,000; the value of cash collateral and related investments was $737,000.

Other

Purchases and sales of portfolio securities excluding in-kind transactions and short-term securities aggregated $54,180,000 and $71,599,000, respectively, for the year ended December 31, 2023. Portfolio securities received and delivered through in-kind transactions aggregated $112,923,000 and $54,815,000, respectively, for the year ended December 31, 2023.

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T. ROWE PRICE DIVIDEND GROWTH ETF

NOTE  4  –   FEDERAL INCOME TAXES

Generally, no provision for federal income taxes is required since the fund intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code and distribute to shareholders all of its taxable income and gains. Distributions determined in accordance with federal income tax regulations may differ in amount or character from net investment income and realized gains for financial reporting purposes.

The fund files U.S. federal, state, and local tax returns as required. The fund’s tax returns are subject to examination by the relevant tax authorities until expiration of the applicable statute of limitations, which is generally three years after the filing of the tax return but which can be extended to six years in certain circumstances. Tax returns for open years have incorporated no uncertain tax positions that require a provision for income taxes.

Capital accounts within the financial reporting records are adjusted for permanent book/tax differences to reflect tax character but are not adjusted for temporary differences. The permanent book/tax adjustments, if any, have no impact on results of operations or net assets. The permanent book/tax adjustments relate primarily to redemptions in kind.

The tax character of distributions paid for the periods presented was as follows:

($000s)
	December 31,	December 31,
	2023	2022
Ordinary income (including short-term capital gains, if any)	$4,421	$2,105

At December 31, 2023, the tax-basis cost of investments, (including derivatives, if any) and gross unrealized appreciation and depreciation were as follows:

($000s)
Cost of investments	$309,528
Unrealized appreciation	$ 43,808
Unrealized depreciation	(3,519)
Net unrealized appreciation (depreciation)	$ 40,289

At December 31, 2023, the tax-basis components of accumulated net earnings (loss) were as follows:

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T. ROWE PRICE DIVIDEND GROWTH ETF

($000s)
Undistributed ordinary income	$ 47
Net unrealized appreciation (depreciation)	40,289
Loss carryforwards and deferrals	(13,390)
Total distributable earnings (loss)	$ 26,946

Temporary differences between book-basis and tax-basis components of total distributable earnings (loss) arise when certain items of income, gain, or loss are recognized in different periods for financial statement purposes versus for tax purposes; these differences will reverse in a subsequent reporting period. The temporary differences relate primarily to the deferral of losses from wash sales. The loss carryforwards and deferrals primarily relate to capital loss carryforwards. Capital loss carryforwards are available indefinitely to offset future realized capital gains.

NOTE  5  –   FOREIGN TAXES

The fund is subject to foreign income taxes imposed by certain countries in which it invests. Additionally, capital gains realized upon disposition of securities issued in or by certain foreign countries are subject to capital gains tax imposed by those countries. All taxes are computed in accordance with the applicable foreign tax law, and, to the extent permitted, capital losses are used to offset capital gains. Taxes attributable to income are accrued by the fund as a reduction of income. Current and deferred tax expense attributable to capital gains is reflected as a component of realized or change in unrealized gain/loss on securities in the accompanying financial statements. To the extent that the fund has country specific capital loss carryforwards, such carryforwards are applied against net unrealized gains when determining the deferred tax liability. Any deferred tax liability incurred by the fund is included in either Other liabilities or Deferred tax liability on the accompanying Statement of Assets and Liabilities.

NOTE  6  –   RELATED PARTY TRANSACTIONS

The fund is managed by T. Rowe Price Associates, Inc. (Price Associates), a wholly owned subsidiary of T. Rowe Price Group, Inc. (Price Group). The investment management and administrative agreement between the fund and Price Associates provides for an all-inclusive annual fee equal to 0.50% of the fund’s average daily net assets. The fee is computed daily and paid monthly. The all-inclusive fee covers investment management

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T. ROWE PRICE DIVIDEND GROWTH ETF

services and ordinary, recurring operating expenses but does not cover interest and borrowing expenses; taxes; brokerage commissions and other transaction costs; fund proxy expenses; and nonrecurring and extraordinary expenses.

T. Rowe Price Investment Services, Inc. (Investment Services) serves as distributor to the fund. Pursuant to an underwriting agreement, no compensation for any distribution services provided is paid to Investment Services by the fund.

Cash collateral from securities lending, if any, is invested in the T. Rowe Price Government Reserve Fund (the Price Reserve Fund), a money market fund offered as a short-term investment option to mutual funds, trusts, and other accounts managed by Price Associates or its affiliates and is not available for direct purchase by members of the public. The Price Reserve Fund does not pay investment management fees.

The fund may participate in securities purchase and sale transactions with other funds or accounts advised by Price Associates (cross trades), in accordance with procedures adopted by the fund’s Board and Securities and Exchange Commission rules, which require, among other things, that such purchase and sale cross trades be effected at the independent current market price of the security. During the year ended December 31, 2023, fund had no purchases or sales cross trades with other funds or accounts advised by Price Associates.

Price Associates has voluntarily agreed to reimburse the fund from its own resources on a monthly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time. For the year ended December 31, 2023, this reimbursement amounted to $2,000, which is included in Net realized gain (loss) on Securities in the Statement of Operations.

NOTE  7  –   OTHER MATTERS

Unpredictable events such as environmental or natural disasters, war and conflict, terrorism, geopolitical events, and public health epidemics and similar public health threats may significantly affect the economy and the markets and issuers in which the fund invests. Certain events may cause instability across global markets, including reduced liquidity and disruptions in trading markets, while some events may affect certain geographic regions, countries, sectors, and industries more significantly than others, and exacerbate other pre-existing political, social, and economic risks.

The global outbreak of COVID-19 and related governmental and public responses have led and may continue to lead to increased market volatility and the potential for illiquidity in certain classes of securities and sectors of the market either in specific countries or worldwide.

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T. ROWE PRICE DIVIDEND GROWTH ETF

In February 2022, Russian forces entered Ukraine and commenced an armed conflict, leading to economic sanctions imposed on Russia that target certain of its citizens and issuers and sectors of the Russian economy, creating impacts on Russian-related stocks and debt and greater volatility in global markets.

In March 2023, the banking industry experienced heightened volatility, which sparked concerns of potential broader adverse market conditions.  The extent of impact of these events on the US and global markets is highly uncertain.

These are recent examples of global events which may have a negative impact on the values of certain portfolio holdings or the fund’s overall performance. Management is actively monitoring the risks and financial impacts arising from these events.

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T. ROWE PRICE DIVIDEND GROWTH ETF

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors of T. Rowe Price Exchange-Traded Funds, Inc. and Shareholders of T. Rowe Price Dividend Growth ETF

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of T. Rowe Price Dividend Growth ETF (one of the funds constituting T. Rowe Price Exchange-Traded Funds, Inc., referred to hereafter as the "Fund") as of December 31, 2023, the related statement of operations for the year ended December 31, 2023,the statement of changes in net assets for each of the two years in the period ended December 31, 2023, including the related notes, and the financial highlights for each of the years ended December 31, 2023, 2022 and 2021 and for the period August 4, 2020 (inception) through December 31, 2020 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of December 31, 2023, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended December 31, 2023 and the financial highlights for each of the years ended December 31, 2023, 2022 and 2021 and for the period August 4, 2020 (inception) through December 31, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

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T. ROWE PRICE DIVIDEND GROWTH ETF

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 

(CONTINUED)

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of December 31, 2023 by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures.  We believe that our audits provide a reasonable basis for our opinion.

/s/  PricewaterhouseCoopers LLP

Baltimore, Maryland

February 16, 2024

We have served as the auditor of one or more investment companies in the T. Rowe Price group of investment companies since 1973.

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TAX INFORMATION (UNAUDITED) FOR THE TAX YEAR ENDED 12/31/23

We are providing this information as required by the Internal Revenue Code. The amounts shown may differ from those elsewhere in this report because of differences between tax and financial reporting requirements. The fund’s distributions to shareholders included:

For taxable non-corporate shareholders, $5,100,000 of the fund’s income represents qualified dividend income subject to a long-term capital gains tax rate of not greater than 20%.

For corporate shareholders,  $4,495,000 of the fund’s income qualifies for the dividends-received deduction.

INFORMATION ON PROXY VOTING POLICIES, PROCEDURES, AND RECORDS

A description of the policies and procedures used by T. Rowe Price funds and portfolios to determine how to vote proxies relating to portfolio securities is available in each  fund’s Statement of Additional Information. You may request this document by calling 1-800-638-5660 or by accessing the SEC’s website, sec.gov.

The description of our proxy voting policies and procedures is also available on our corporate website. To access it, please visit the following Web page:

https://www.troweprice.com/corporate/en/utility/policies.html

Scroll down to the section near the bottom of the page that says, “Proxy Voting Policies.”  Click on the Proxy Voting Policies link in the shaded box.

Each fund’s most recent annual proxy voting record is available on our website and  through the SEC’s website. To access it through T. Rowe Price, visit the website location shown above, and scroll down to the section near the bottom of the page that says, “Proxy Voting Records.” Click on the Proxy Voting Records link in the shaded box.

HOW TO OBTAIN QUARTERLY PORTFOLIO HOLDINGS

The fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund’s Form N-PORT is available electronically on the SEC’s website (sec.gov). In addition, most T. Rowe Price funds disclose their first and third fiscal quarter-end holdings on troweprice.com.

TAILORED SHAREHOLDER REPORTS FOR MUTUAL FUNDS AND EXCHANGE TRADED FUNDS

In October 2022, the Securities and Exchange Commission (SEC) adopted rule and form amendments requiring Mutual Funds and Exchange-Traded Funds to transmit concise and visually engaging streamlined annual and semiannual reports that highlight key information to shareholders. Other information, including financial statements, will no longer appear in

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the funds’ shareholder reports but will be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024.

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Liquidity Risk Management Program

In accordance with Rule 22e-4 (Liquidity Rule) under the Investment Company Act of 1940, as amended, the fund has established a liquidity risk management program (Liquidity Program) reasonably designed to assess and manage the fund’s liquidity risk, which generally represents the risk that the fund would not be able to meet redemption requests without significant dilution of remaining investors’ interests in the fund. The fund’s Board of Directors (Board) has appointed the fund’s investment adviser, T. Rowe Price Associates, Inc. (Adviser), as the administrator of the Liquidity Program. As administrator, the Adviser is responsible for overseeing the day-to-day operations of the Liquidity Program and, among other things, is responsible for assessing, managing, and reviewing with the Board at least annually the liquidity risk of each T. Rowe Price fund. The Adviser has delegated oversight of the Liquidity Program to a Liquidity Risk Committee (LRC), which is a cross-functional committee composed of personnel from multiple departments within the Adviser. 

The Liquidity Program’s principal objectives include supporting the T. Rowe Price funds’ compliance with limits on investments in illiquid assets and mitigating the risk that the fund will be unable to timely meet its redemption obligations. The Liquidity Program also includes a number of elements that support the management and assessment of liquidity risk, including an annual assessment of factors that influence the fund’s liquidity and the periodic classification and reclassification of a fund’s investments into categories that reflect the LRC’s assessment of their relative liquidity under current market conditions. Under the Liquidity Program, every investment held by the fund is classified at least monthly into one of four liquidity categories based on estimations of the investment’s ability to be sold during designated time frames in current market conditions without significantly changing the investment’s market value.

As required by the Liquidity Rule, at a meeting held on July 24, 2023, the Board was presented with an annual assessment that was prepared by the LRC on behalf of the Adviser and addressed the operation of the Liquidity Program and assessed its adequacy and effectiveness of implementation, including any material changes to the Liquidity Program and the determination of each fund’s Highly Liquid Investment Minimum (HLIM). The annual assessment included consideration of the following factors, as applicable: the fund’s investment strategy and liquidity of portfolio investments during normal and reasonably foreseeable stressed conditions, including whether the investment strategy is appropriate for an open-end fund, the extent to which the strategy involves a relatively concentrated portfolio or large positions in particular issuers, and the use of borrowings for investment purposes and derivatives; short-term and long-term cash flow projections covering both normal and reasonably foreseeable stressed conditions; and holdings of cash and cash equivalents, as well as available borrowing arrangements.

For the fund and other T. Rowe Price funds, the annual assessment incorporated a report related to a fund’s holdings, shareholder and portfolio concentration, any borrowings during the period, cash flow projections, and other relevant data for the period of April 1, 2022, through March 31, 2023. The report described the methodology for classifying a fund’s investments (including any derivative transactions) into one of four liquidity

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categories, as well as the percentage of a fund’s investments assigned to each category. It also explained the methodology for establishing a fund’s HLIM and noted that the LRC reviews the HLIM assigned to each fund no less frequently than annually.

During the period covered by the annual assessment, the LRC has concluded, and reported to the Board, that the Liquidity Program continues to operate adequately and effectively and is reasonably designed to assess and manage the fund’s liquidity risk.

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ABOUT THE FUND’S DIRECTORS AND OFFICERS

Your fund is overseen by a Board of Directors (Board) that meets regularly to review a wide variety of matters affecting or potentially affecting the fund, including performance, investment programs, compliance matters, advisory fees and expenses, service providers, and business and regulatory affairs. The Board elects the fund’s officers, who are listed in the final table. The directors who are also employees or officers of T. Rowe Price are considered to be “interested” directors as defined in Section 2(a)(19) of the 1940 Act because of their relationships with T. Rowe Price Associates, Inc. (T. Rowe Price), and its affiliates. The business address of each director and officer is 100 East Pratt Street, Baltimore, Maryland 21202. The Statement of Additional Information includes additional information about the fund directors and is available without charge by calling a T. Rowe Price representative at 1-800-638-5660.

INDEPENDENT DIRECTORS^(a)

Name (Year of Birth) Year Elected [Number of T. Rowe Price Portfolios Overseen]	Principal Occupation(s) and Directorships of Public Companies and Other Investment Companies During the Past Five Years
Teresa Bryce Bazemore (1959) 2020 [209]	President and Chief Executive Officer, Federal Home Loan Bank of San Francisco (2021 to present); Chief Executive Officer, Bazemore Consulting LLC (2018 to 2021); Director, Chimera Investment Corporation (2017 to 2021); Director, First Industrial Realty Trust (2020 to present); Director, Federal Home Loan Bank of Pittsburgh (2017 to 2019)
Melody Bianchetto (1966) 2023 [209]	Vice President for Finance, University of Virginia (2015 to 2023)
Bruce W. Duncan (1951) 2020 [209]	President, Chief Executive Officer, and Director, CyrusOne, Inc. (2020 to 2021); Chair of the Board (2016 to 2020) and President (2009 to 2016), First Industrial Realty Trust, owner and operator of industrial properties; Member, Investment Company Institute Board of Governors (2017 to 2019); Member, Independent Directors Council Governing Board (2017 to 2019); Senior Advisor, KKR (2018 to 2022); Director, Boston Properties (2016 to present); Director, Marriott International, Inc. (2016 to 2020)
Robert J. Gerrard, Jr. (1952) 2020 [209]	Chair of the Board, all funds (July 2018 to present)

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INDEPENDENT DIRECTORS^(a) (continued)

Name (Year of Birth) Year Elected [Number of T. Rowe Price Portfolios Overseen]	Principal Occupation(s) and Directorships of Public Companies and Other Investment Companies During the Past Five Years
Paul F. McBride (1956) 2020 [209]	Advisory Board Member, Vizzia Technologies (2015 to present); Board Member, Dunbar Armored (2012 to 2018)
Mark J. Parrell (1966) 2023 [209]	Board of Trustees Member and Chief Executive Officer (2019 to present), President (2018 to present), Executive Vice President and Chief Financial Officer (2007 to 2018), and Senior Vice President and Treasurer (2005 to 2007), EQR; Member, Nareit Dividends Through Diversity, Equity & Inclusion CEO Council and Chair, Nareit 2021 Audit and Investment Committee (2021); Advisory Board, Ross Business School at University of Michigan (2015 to 2016); Member, National Multifamily Housing Council and served as Chair of the Finance Committee (2015 to 2016); Member, Economic Club of Chicago; Director, Brookdale Senior Living, Inc. (2015 to 2017); Director, Aviv REIT, Inc. (2013 to 2015); Director, Real Estate Roundtable and the 2022 Executive Board Nareit; Board of Directors and Chair of the Finance Committee, Greater Chicago Food Depository
Kellye L. Walker (1966) 2021 [209]	Executive Vice President and Chief Legal Officer, Eastman Chemical Company (April 2020 to present); Executive Vice President and Chief Legal Officer, Huntington Ingalls Industries, Inc. (January 2015 to March 2020); Director, Lincoln Electric Company (October 2020 to present)

  ^(a)All information about the independent directors was current as of December 31, 2022, unless otherwise indicated, except for the number of portfolios overseen, which is current as of the date of this report.

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INTERESTED DIRECTORS^(a)

Name (Year of Birth) Year Elected [Number of T. Rowe Price Portfolios Overseen]	Principal Occupation(s) and Directorships of Public Companies and Other Investment Companies During the Past Five Years
David Oestreicher (1967) 2020 [209]	Director, Vice President, and Secretary, T. Rowe Price, T. Rowe Price Investment Services, Inc., T. Rowe Price Retirement Plan Services, Inc., and T. Rowe Price Services, Inc.; Director and Secretary, T. Rowe Price Investment Management, Inc. (Price Investment Management); Vice President and Secretary, T. Rowe Price International (Price International); Vice President, T. Rowe Price Hong Kong (Price Hong Kong), T. Rowe Price Japan (Price Japan), and T. Rowe Price Singapore (Price Singapore); General Counsel, Vice President, and Secretary, T. Rowe Price Group, Inc.; Chair of the Board, Chief Executive Officer, President, and Secretary, T. Rowe Price Trust Company; Principal Executive Officer and Executive Vice President, all funds
Eric L. Veiel, CFA (1972) 2022 [209]	Director and Vice President, T. Rowe Price; Vice President, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company; Vice President, Global Funds

  ^(a)All information about the interested directors was current as of December 31, 2022, unless otherwise indicated, except for the number of portfolios overseen, which is current as of the date of this report.

OFFICERS

Name (Year of Birth) Position Held With Exchange-Traded Funds, Inc.	Principal Occupation(s)
Christopher P. Brown (1977) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Armando (Dino) Capasso (1974) Chief Compliance Officer and Vice President	Chief Compliance Officer and Vice President, T. Rowe Price and Price Investment Management; Vice President, T. Rowe Price Group, Inc.; formerly, Chief Compliance Officer, PGIM Investments LLC and AST Investment Services, Inc. (ASTIS) (to 2022); Chief Compliance Officer, PGIM Retail Funds complex and Prudential Insurance Funds (to 2022); Vice President and Deputy Chief Compliance Officer, PGIM Investments LLC and ASTIS (to 2019)
Timothy Coyne (1967) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Vincent Michael DeAugustino (1983) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.

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OFFICERS (continued)

Name (Year of Birth) Position Held With Exchange-Traded Funds, Inc.	Principal Occupation(s)
Anna Alexandra Dreyer, Ph.D., CFA (1981) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Alan S. Dupski, CPA (1982) Principal Financial Officer, Vice President, and Treasurer	Vice President, Price Investment Management, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Cheryl Emory (1963) Assistant Secretary	Assistant Vice President and Assistant Secretary, T. Rowe Price; Assistant Secretary, T. Rowe Price Group, Inc., Price Investment Management, Price International, Price Hong Kong, Price Singapore, T. Rowe Price Investment Services, Inc., T. Rowe Price Retirement Plan Services, Inc., and T. Rowe Price Trust Company
Joseph B. Fath, CPA (1971) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
David Giroux (1975) Executive Vice President	Vice President, Price Investment Management, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Paul Greene II (1978) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Cheryl Hampton, CPA (1969) Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company; formerly, Tax Director, Invesco Ltd. (to 2021); Vice President, Oppenheimer Funds, Inc. (to 2019)
Ann M. Holcomb, CFA (1972) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Thomas J. Huber, CFA (1966) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Stephon Jackson, CFA (1962) Co-president	Director and President, Price Investment Management; Vice President, T. Rowe Price Group, Inc.
Benjamin Kersse, CPA (1989) Vice President	Vice President, T. Rowe Price and T. Rowe Price Trust Company
Paul J. Krug, CPA (1964) Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Robert M. Larkins, CFA (1973) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
John D. Linehan, CFA (1965) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company

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OFFICERS (continued)

Name (Year of Birth) Position Held With Exchange-Traded Funds, Inc.	Principal Occupation(s)
Jodi Love (1977) Executive Vice President	Vice President, Price Investment Management and T. Rowe Price Group, Inc.; formerly, Managing Director, Jennison Associates LLC (to 2019)
Paul M. Massaro, CFA (1975) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Robert P. McDavid (1972) Vice President	Vice President, T. Rowe Price, T. Rowe Price Investment Management, T. Rowe Price Investment Services, Inc., and T. Rowe Price Trust Company
Colin McQueen (1967) Executive Vice President	Vice President, Price Investment Management and T. Rowe Price Group, Inc.; formerly, Senior Investment Manager, Global Equities, Sanlam FOUR Investments UK Limited (to 2019)
Joshua Nelson (1977) Co-president	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., Price International, and T. Rowe Price Trust Company
Jason Nogueira, CFA (1974) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Alexander S. Obaza (1981) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Donald J. Peters (1959) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Fran M. Pollack-Matz (1961) Vice President and Secretary	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., T. Rowe Price Investment Services, Inc., T. Rowe Price Services, Inc., and T. Rowe Price Trust Company
Jason Benjamin Polun, CFA (1974) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Sebastian Schrott (1977) Executive Vice President	Vice President, T. Rowe Price Group, Inc., and Price International
Richard Sennett, CPA (1970) Assistant Treasurer	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Gabriel Solomon (1977) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.
Peter Stournaras (1973) Executive Vice President	Vice President, T. Rowe Price and T. Rowe Price Group, Inc.; formerly, Managing Director and Chief Portfolio Strategist, JP Morgan Private Bank (to 2020)

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OFFICERS (continued)

Name (Year of Birth) Position Held With Exchange-Traded Funds, Inc.	Principal Occupation(s)
Taymour R. Tamaddon, CFA (1976) Executive Vice President	Vice President, T. Rowe Price, T. Rowe Price Group, Inc., and T. Rowe Price Trust Company
Ellen York (1988) Vice President	Vice President, Price Investment Management and T. Rowe Price

Unless otherwise noted, officers have been employees of T. Rowe Price or Price International for at least 5 years.

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100 East Pratt Street

Baltimore, MD 21202

Call 1-800-638-5660 to request a prospectus or summary prospectus; each includes investment objectives, risks, fees, expenses, and other information that you should read and consider carefully before investing.

202402-3281575

T. Rowe Price Investment Services, Inc.

ETF786-050 02/24