N-CSR

Schwab High Yield Bond ETF

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than the performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabassetmanagement.com/schwabetfs_prospectus.

Total Returns for the 12 Months Ended August 31, 2023
Schwab High Yield Bond ETF (Ticker Symbol: SCYB)
Market Price Return1	2.04% *
NAV Return1	2.04% *
ICE BofA US Cash Pay High Yield Constrained Index	2.15% *
ETF Category: Morningstar High Yield Bond2	N/A
Performance Details	pages 6-7

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.

For index definitions, please see the Glossary.

Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares.

Shares are bought and sold at market price, which may be higher or lower than the net asset value (NAV). Brokerage commissions will reduce returns.

Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency.

High-yield securities and unrated securities of similar credit quality (junk bonds) are subject to greater levels of credit and liquidity risks and may be more volatile than higher-rated securities. High-yield securities are considered predominately speculative with respect to the issuer’s continuing ability to make principal and interest payments.

“ICE®” is a registered trademark of ICE Data Indices, LLC or its affiliates and “BofA®” is a registered trademark of Bank of America Corporation licensed by Bank of America Corporation and its affiliates (“BofA”) and may not be used without BofA’s prior written approval. These trademarks have been licensed, along with the ICE BofA US Cash Pay High Yield Constrained Index (“Index”) for use by Charles Schwab Investment Management, Inc., dba Schwab Asset Management, in connection with the Schwab High Yield Bond ETF. The Schwab High Yield Bond ETF is not sponsored, endorsed, sold or promoted by ICE Data Indices, LLC, its affiliates or its Third Party Suppliers (“ICE Data and its Suppliers”). ICE Data and its Suppliers make no representations or warranties regarding the advisability of investing in the Schwab High Yield Bond ETF.

Total returns shown are since the fund’s inception date of July 11, 2023.

ETF performance must be shown based on both a Market Price and a NAV basis. The fund’s per share NAV is the value of one share of the fund. NAV is calculated by taking the fund’s total assets (including the fair value of securities owned), subtracting liabilities, and dividing by the number of shares outstanding. The NAV Return is based on the NAV of the fund, and the Market Price Return is based on the market price per share of the fund. The price used to calculate market return (Market Price) is determined using the Official Closing Price of the primary stock exchange (generally, 4:00 p.m. Eastern time) and may not represent the returns you would receive if shares were traded at other times. Market Price and NAV returns assume that dividends and capital gain distributions have been reinvested in the fund at Market Price and NAV, respectively.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all passively- and actively-managed ETFs and mutual funds within the category as of the report date.

2Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

The Investment Environment

For the reporting period of July 11, 2023* through August 31, 2023, the ongoing war between Russia and Ukraine weighed on the global economy, but the U.S. economy continued to show unexpected resiliency. Inflation remained elevated—although down significantly from recent highs—and the U.S. Federal Reserve (Fed) continued to raise interest rates, driving yields on taxable bonds up and resulting in negative returns for most U.S. fixed-income markets. (Bond yields and bond prices typically move in opposite directions.) For the reporting period, the ICE BofA US Cash Pay High Yield Constrained Index, which tracks the performance of publicly issued U.S. dollar–denominated below-investment grade corporate debt, returned 2.15%

There were a few short-lived yet market-moving events in the first eight months of 2023. The failure of three U.S. regional banks in early March raised concerns about the stability of the banking sector. In addition, debt ceiling negotiations during the second quarter of 2023 created fear that the federal government could default on its obligations and on August 1, 2023, Fitch Ratings downgraded long-term U.S. debt from AAA to AA+ after indicating earlier in the year that a country refusing to pay its debts in a timely way was not entitled to a AAA rating. Among fixed-income markets, high-yield bonds were among the strongest performers. Lower-quality bonds—particularly distressed bonds—outperformed higher-quality bonds. Credit spreads on high-yield bonds generally tightened during the reporting period.

The U.S. economy continued to show unexpected resilience. U.S. gross domestic product (GDP) remained positive for first and second quarters of 2023. Inflation generally declined throughout 2023, though it remained above the Fed’s historical 2% target and rose slightly in July and August. Consumer spending remained strong as consumers continued to spend down the significant savings they accumulated during the COVID-19 pandemic. The unemployment rate remained low despite inflationary pressures. However, unemployment unexpectedly jumped in August largely as a result of an increase in the labor force participation rate (the proportion of working-age Americans who have a job or are looking for one) which rose to its highest level since February 2020, just prior to the COVID-19 pandemic declaration.

Yields of U.S. Treasury Securities: Effective Yields of Three-Month, Two-Year and 10-Year Treasuries

Index figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized. Past performance is not an indication of future results.

For index definitions, please see the Glossary.

Data source: Bloomberg L.P.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views may have changed since the report date.

The fund’s inception date. Inception represents the date that the shares began trading in the secondary market.

Schwab High Yield Bond ETF | Annual Report3

Schwab High Yield Bond ETF

Fund Management

Matthew Hastings, CFA, Managing Director and Head of Taxable Bond Strategies for Schwab Asset

Management, is responsible for the day-to-day co-management of the fund. Mr. Hastings leads the portfolio

management team for the Schwab Taxable Bond Funds and Schwab Fixed-Income ETFs. He also has overall

responsibility for all aspects of the management of the funds. Prior to joining Schwab in 1999, Mr. Hastings

was in fixed-income sales and trading at Lehman Brothers. He has worked in the fixed-income securities

industry since 1996.

Ryan Hook, CFA, Senior Portfolio Manager for Schwab Asset Management, is responsible for the day-to-day

co-management of the fund. Prior to joining Schwab in 2022, Mr. Hook spent nearly two years as a Portfolio

Strategist at Capital Group, where he was responsible for managing high yield institutional mandates. Prior to

that, he spent 14 years at Goldman Sachs working mainly in high yield portfolio construction and trading, as

well as product management.

Steven Hung, Senior Portfolio Manager for Schwab Asset Management, is responsible for the day-to-day

co-management of the fund. He is primarily responsible for the management and oversight of corporate

bonds within the taxable bond strategies, with additional responsibility for managing municipal bond index

strategies. Mr. Hung has been a portfolio manager with Schwab Asset Management since 2005 and prior to

that, served in various roles as an associate portfolio manager and trader since 1999. In 1998, he joined

Schwab’s management training program and worked as a clerk on the options trading floor of the Pacific

Coast Stock Exchange.

Schwab High Yield Bond ETF | Annual Report5

Schwab High Yield Bond ETF

The Schwab High Yield Bond ETF’s (the fund) goal is to track as closely as possible, before fees and expenses, the total return of an index that measures the performance of U.S. dollar denominated below investment grade corporate debt. To pursue its goal, the fund generally invests in securities that are included in the ICE BofA US Cash Pay High Yield Constrained Index. ICE BofA US Cash Pay High Yield Constrained Index tracks the performance of U.S. dollar denominated below investment grade corporate debt (junk bonds), currently in a coupon paying period, that is publicly issued in the U.S. domestic market. For more information about the fund’s investment objective, strategy, and risks, please see the fund’s prospectus.

Market Highlights. For the reporting period of July 11, 2023* through August 31, 2023, the ongoing war between Russia and Ukraine weighed on the global economy, but the U.S. economy continued to show unexpected resiliency. Inflation remained elevated—although down significantly from recent highs—and the U.S. Federal Reserve (Fed) continued to raise interest rates, driving yields on taxable bonds up and resulting in negative returns for most U.S. fixed-income markets. (Bond yields and bond prices typically move in opposite directions.) In its efforts to lower inflation, the Fed raised interest rates by 0.25% in July, its eleventh upward move since it began raising rates in March of 2022. The federal funds rate ended the reporting period in a range of 5.25% to 5.50%.

Performance. During the reporting period of July 11, 2023 (the fund’s inception date*), through August 31, 2023, the fund generally tracked the performance of the index. For the reporting period, the fund’s market price and NAV returns were 2.04% (for an explanation of market price and NAV returns, please refer to footnote 2 on the following page). The index returned 2.15% during the same period. Of the fund’s return, slightly more than half came from price appreciation, with the remainder coming from income. Differences between the return of the fund and the return of the index may be attributable to, among other things, the operational and transactional costs incurred by the fund and not the index.

Inception represents the date that the shares began trading in the secondary market.

Portfolio Composition % of Investments1

By Security Type

Weighted Average Maturity3	4.7 Yrs
Weighted Average Duration3	3.6 Yrs

Management views and portfolio holdings may have changed since the report date.

An index is a statistical composite of a specified financial market or sector. Unlike the fund, an index does not actually hold a portfolio of securities and its return is not inclusive of operational and transaction costs incurred by the fund.

Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency.

The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets.

Includes the fund’s position(s) in money market mutual funds registered under the Investment Company Act of 1940, as amended.

See Glossary for definitions of maturity and duration.

6Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Performance and Fund Facts as of August 31, 2023

Performance of Hypothetical $10,000 Investment (July 11, 2023 – August 31, 2023)1

Average Annual Total Returns1

Fund and Inception Date	Since Inception*
Fund: Schwab High Yield Bond ETF (7/11/23)
Market Price Return2	2.04%
NAV Return2	2.04%
ICE BofA US Cash Pay High Yield Constrained Index	2.15%
ETF Category: Morningstar High Yield Bond3	N/A
Fund Expense Ratio4: 0.03%

For index definitions, please see the Glossary.

Shares are bought and sold at market price, which may be higher or lower than the net asset value (NAV). Brokerage commissions will reduce returns.

Inception (7/11/23) represents the date that the shares began trading in the secondary market.

Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption or sale of fund shares.

ETF performance must be shown based on both a Market Price and a NAV basis. The fund’s per share NAV is the value of one share of the fund. NAV is calculated by taking the fund’s total assets (including the fair value of securities owned), subtracting liabilities, and dividing by the number of shares outstanding. The NAV Return is based on the NAV of the fund, and the Market Price Return is based on the market price per share of the fund. The price used to calculate market return (Market Price) is determined using the Official Closing Price of the primary stock exchange (generally, 4:00 p.m. Eastern time) and may not represent the returns you would receive if shares were traded at other times. NAV is used as a proxy for purposes of calculating Market Price Return on inception date. Market Price and NAV returns assume that dividends and capital gain distributions have been reinvested in the fund at Market Price and NAV, respectively.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all passively- and actively-managed ETFs and mutual funds within the category as of the report date.

As stated in the prospectus. Effective September 25, 2023, the management fee was reduced from 0.10% to 0.03%. For more information, see financial note 4 or refer to the prospectus.

Schwab High Yield Bond ETF | Annual Report7

Schwab High Yield Bond ETF

Fund Expenses (Unaudited)

Examples for a $1,000 Investment

As a fund shareholder, you may incur two types of costs: (1) transaction costs, including brokerage commissions on purchases and sales of fund shares; and, (2) ongoing costs, including management fees.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in the fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning March 1, 2023 and held through August 31, 2023.

The Actual Return line in the table below provides information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number given for the fund under the heading entitled “Expenses Paid During Period.”

The Hypothetical Return line in the table below provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, including any brokerage commissions you may pay when purchasing or selling shares of a fund. Therefore, the hypothetical return 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. In addition, if these transactional costs were included, your costs would have been higher.

	EXPENSE RATIO (ANNUALIZED) 1	BEGINNING ACCOUNT VALUE AT 3/1/23	ENDING ACCOUNT VALUE (NET OF EXPENSES) AT 8/31/232	EXPENSES PAID DURING PERIOD 3/1/23-8/31/23 2
Schwab High Yield Bond ETF
Actual Return	0.10%	$1,000.00	$1,020.40	$0.14
Hypothetical 5% Return	0.10%	$1,000.00	$1,024.70	$0.51

The expense ratio provided for the fund is for the period from 7/11/23 (commencement of operations) through 8/31/23 (see financial note 4 for additional information).

Actual expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 52 days in the period from

commencement of operations on 7/11/23 through 8/31/23, and divided by 365 days in the fiscal year. Hypothetical expenses for the fund are equal to its annualized expense

ratio, multiplied by the average account value over the period, multiplied by 184 days in the period, and divided by 365 days in the fiscal year.

8Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-PORT Part F. The fund’s Form N-PORT Part F is available on the SEC’s website at www.sec.gov. You can also obtain this information at no cost on the fund’s website at www.schwabassetmanagement.com/schwabetfs_prospectus, by calling 1-866-414-6349, or by sending an email request to [email protected]. The fund also makes available its complete schedule of portfolio holdings on a daily basis on the fund’s website.

All securities are currently in a fixed rate coupon period based on index eligibility requirements and the fund’s investment objective. Generally, for fixed rate securities, the rate shown is the interest rate that was established when the security was issued. Variable rate securities are subject to index requirements and will be removed from the index and fund prior to converting from a fixed rate coupon to a variable rate coupon. The maturity date shown for all the securities is the final legal maturity.

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
CORPORATES 95.9% OF NET ASSETS

Financial Institutions 9.6%
Banking 0.7%
Ally Financial, Inc.
5.75%, 11/20/25 (a)	55,000	53,399
Intesa Sanpaolo S.p.A.
5.71%, 01/15/26 (b)	200,000	192,385
Popular, Inc.
7.25%, 03/13/28 (a)	20,000	20,146
Synchrony Financial
7.25%, 02/02/33 (a)	40,000	36,811
Western Alliance Bancorp
3.00%, 06/15/31 (a)(c)	20,000	15,867
		318,608
Brokerage/Asset Managers/Exchanges 0.7%
AG TTMT Escrow Issuer LLC
8.63%, 09/30/27 (a)(b)	75,000	77,373
Coinbase Global, Inc.
3.38%, 10/01/28 (a)(b)	100,000	73,665
Compass Group Diversified Holdings LLC
5.25%, 04/15/29 (a)(b)	75,000	68,955
Hunt Cos., Inc.
5.25%, 04/15/29 (a)(b)	24,000	18,356
NFP Corp.
6.88%, 08/15/28 (a)(b)	70,000	61,717
		300,066
Finance Companies 2.5%
Curo Group Holdings Corp.
7.50%, 08/01/28 (a)(b)	50,000	16,742
FirstCash, Inc.
5.63%, 01/01/30 (a)(b)	75,000	68,172
Fortress Transportation & Infrastructure Investors LLC
6.50%, 10/01/25 (a)(b)	5,000	4,942
5.50%, 05/01/28 (a)(b)	160,000	148,774
Freedom Mortgage Corp.
8.25%, 04/15/25 (a)(b)	54,000	53,271
GGAM Finance Ltd.
8.00%, 06/15/28 (a)(b)	40,000	40,598
Goeasy Ltd.
4.38%, 05/01/26 (a)(b)	30,000	27,572
Home Point Capital, Inc.
5.00%, 02/01/26 (a)(b)	25,000	23,501
Macquarie Airfinance Holdings Ltd.
8.38%, 05/01/28 (a)(b)	60,000	61,317

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Navient Corp.
5.88%, 10/25/24	25,000	24,649
6.75%, 06/25/25	60,000	59,643
5.00%, 03/15/27 (a)	50,000	45,541
5.50%, 03/15/29 (a)	50,000	42,800
OneMain Finance Corp.
6.88%, 03/15/25	60,000	59,755
7.13%, 03/15/26	50,000	49,245
9.00%, 01/15/29 (a)	100,000	101,470
4.00%, 09/15/30 (a)	50,000	38,993
PennyMac Financial Services, Inc.
5.38%, 10/15/25 (a)(b)	15,000	14,532
4.25%, 02/15/29 (a)(b)	45,000	37,293
PROG Holdings, Inc.
6.00%, 11/15/29 (a)(b)	25,000	22,465
Rocket Mortgage LLC/Rocket Mortgage Co-Issuer, Inc.
3.88%, 03/01/31 (a)(b)	175,000	142,625
SLM Corp.
3.13%, 11/02/26 (a)	25,000	22,276
United Wholesale Mortgage LLC
5.50%, 11/15/25 (a)(b)	50,000	48,122
		1,154,298
Financial Other 1.9%
Burford Capital Global Finance LLC
6.88%, 04/15/30 (a)(b)	200,000	183,650
Credit Acceptance Corp.
5.13%, 12/31/24 (a)(b)	25,000	24,375
Five Point Operating Co. LP/Five Point Capital Corp.
7.88%, 11/15/25 (a)(b)	25,000	23,341
Icahn Enterprises LP/Icahn Enterprises Finance Corp.
4.75%, 09/15/24 (a)	60,000	58,057
5.25%, 05/15/27 (a)	125,000	109,823
4.38%, 02/01/29 (a)	25,000	19,769
Kennedy-Wilson, Inc.
4.75%, 02/01/30 (a)	260,000	200,573
Nationstar Mortgage Holdings, Inc.
6.00%, 01/15/27 (a)(b)	25,000	23,835
5.50%, 08/15/28 (a)(b)	50,000	45,365
5.75%, 11/15/31 (a)(b)	10,000	8,641
PHH Mortgage Corp.
7.88%, 03/15/26 (a)(b)	20,000	17,909
PRA Group, Inc.
8.38%, 02/01/28 (a)(b)	35,000	31,978
5.00%, 10/01/29 (a)(b)	135,000	101,950
The Howard Hughes Corp.
5.38%, 08/01/28 (a)(b)	50,000	45,086
		894,352

See financial notes

10Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Insurance 1.8%
Acrisure LLC/Acrisure Finance, Inc.
7.00%, 11/15/25 (a)(b)	50,000	48,372
6.00%, 08/01/29 (a)(b)	35,000	30,441
Alliant Holdings Intermediate LLC/Alliant Holdings Co-Issuer
4.25%, 10/15/27 (a)(b)	25,000	22,721
6.75%, 10/15/27 (a)(b)	100,000	94,629
6.75%, 04/15/28 (a)(b)	25,000	24,654
AmWINS Group, Inc.
4.88%, 06/30/29 (a)(b)	25,000	22,458
AssuredPartners, Inc.
5.63%, 01/15/29 (a)(b)	5,000	4,349
BroadStreet Partners, Inc.
5.88%, 04/15/29 (a)(b)	75,000	66,076
GTCR AP Finance, Inc.
8.00%, 05/15/27 (a)(b)	50,000	49,477
HUB International Ltd.
5.63%, 12/01/29 (a)(b)	25,000	22,136
7.25%, 06/15/30 (a)(b)	160,000	163,031
Jones Deslauriers Insurance Management, Inc.
10.50%, 12/15/30 (a)(b)	10,000	10,193
Liberty Mutual Group, Inc.
7.80%, 03/07/87 (b)	50,000	51,552
MGIC Investment Corp.
5.25%, 08/15/28 (a)	25,000	23,883
Molina Healthcare, Inc.
4.38%, 06/15/28 (a)(b)	100,000	91,860
NMI Holdings, Inc.
7.38%, 06/01/25 (a)(b)	55,000	55,422
USI, Inc.
6.88%, 05/01/25 (a)(b)	25,000	25,020
		806,274
REITs 2.0%
Apollo Commercial Real Estate Finance, Inc.
4.63%, 06/15/29 (a)(b)	20,000	15,705
Blackstone Mortgage Trust, Inc.
3.75%, 01/15/27 (a)(b)	25,000	21,406
Brookfield Property REIT, Inc./BPR Cumulus LLC/BPR Nimbus LLC/GGSI Sellco LL
5.75%, 05/15/26 (a)(b)	25,000	22,967
4.50%, 04/01/27 (a)(b)	50,000	41,804
Diversified Healthcare Trust
9.75%, 06/15/25 (a)	25,000	24,611
4.38%, 03/01/31 (a)	25,000	18,885
HAT Holdings I LLC/HAT Holdings II LLC
3.38%, 06/15/26 (a)(b)	65,000	58,436
Ladder Capital Finance Holdings LLLP/Ladder Capital Finance Corp.
4.25%, 02/01/27 (a)(b)	25,000	22,639
4.75%, 06/15/29 (a)(b)	25,000	21,043
MPT Operating Partnership LP/MPT Finance Corp.
5.25%, 08/01/26 (a)	25,000	21,267
5.00%, 10/15/27 (a)	75,000	59,337
4.63%, 08/01/29 (a)	40,000	28,931
Office Properties Income Trust
2.40%, 02/01/27 (a)	50,000	33,873
Park Intermediate Holdings LLC/PK Domestic Property LLC/PK Finance Co-Issuer
5.88%, 10/01/28 (a)(b)	50,000	46,300
4.88%, 05/15/29 (a)(b)	20,000	17,368
RHP Hotel Properties LP/RHP Finance Corp.
7.25%, 07/15/28 (a)(b)	15,000	15,089
4.50%, 02/15/29 (a)(b)	50,000	43,935

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Rithm Capital Corp.
6.25%, 10/15/25 (a)(b)	10,000	9,436
RLJ Lodging Trust LP
3.75%, 07/01/26 (a)(b)	75,000	68,786
Service Properties Trust
4.35%, 10/01/24 (a)	90,000	86,698
7.50%, 09/15/25 (a)	100,000	98,912
5.25%, 02/15/26 (a)	20,000	18,442
Starwood Property Trust, Inc.
3.63%, 07/15/26 (a)(b)	25,000	22,396
4.38%, 01/15/27 (a)(b)	25,000	22,352
The Necessity Retail REIT Inc/American Finance Operating Partner LP
4.50%, 09/30/28 (a)(b)	40,000	30,671
XHR LP
4.88%, 06/01/29 (a)(b)	50,000	43,306
		914,595
		4,388,193

Industrial 83.3%
Basic Industry 4.5%
Alliance Resource Operating Partners LP/Alliance Resource Finance Corp.
7.50%, 05/01/25 (a)(b)	50,000	49,881
Ashland, Inc.
6.88%, 05/15/43 (a)	15,000	14,676
ASP Unifrax Holdings, Inc.
5.25%, 09/30/28 (a)(b)	25,000	16,930
7.50%, 09/30/29 (a)(b)	10,000	5,215
ATI, Inc.
4.88%, 10/01/29 (a)	25,000	22,595
5.13%, 10/01/31 (a)	25,000	22,198
Avient Corp.
5.75%, 05/15/25 (a)(b)	2,000	1,975
7.13%, 08/01/30 (a)(b)	75,000	74,996
Axalta Coating Systems LLC/Axalta Coating Systems Dutch Holding B BV
4.75%, 06/15/27 (a)(b)	150,000	141,292
Baffinland Iron Mines Corp./Baffinland Iron Mines LP
8.75%, 07/15/26 (a)(b)	25,000	24,401
Big River Steel LLC/BRS Finance Corp.
6.63%, 01/31/29 (a)(b)	15,000	14,927
Cleveland-Cliffs, Inc.
5.88%, 06/01/27 (a)	50,000	48,209
6.75%, 04/15/30 (a)(b)	50,000	47,729
Commercial Metals Co.
4.13%, 01/15/30 (a)	25,000	22,148
CVR Partners LP/CVR Nitrogen Finance Corp.
6.13%, 06/15/28 (a)(b)	25,000	22,406
Domtar Corp.
6.75%, 10/01/28 (a)(b)	25,000	21,651
Eldorado Gold Corp.
6.25%, 09/01/29 (a)(b)	25,000	21,381
Element Solutions, Inc.
3.88%, 09/01/28 (a)(b)	25,000	22,000
FMG Resources August 2006 Pty Ltd.
4.50%, 09/15/27 (a)(b)	20,000	18,475
5.88%, 04/15/30 (a)(b)	15,000	13,935
4.38%, 04/01/31 (a)(b)	25,000	20,971
6.13%, 04/15/32 (a)(b)	85,000	79,192
GrafTech Finance, Inc.
4.63%, 12/15/28 (a)(b)	65,000	51,083

See financial notes

Schwab High Yield Bond ETF | Annual Report11

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Graphic Packaging International LLC
3.50%, 03/15/28 (b)	10,000	8,919
3.50%, 03/01/29 (a)(b)	75,000	64,360
3.75%, 02/01/30 (a)(b)	15,000	12,800
Hecla Mining Co.
7.25%, 02/15/28 (a)	25,000	24,585
Hudbay Minerals, Inc.
6.13%, 04/01/29 (a)(b)	25,000	23,527
Innophos Holdings, Inc.
9.38%, 02/15/28 (a)(b)	2,000	1,965
Kaiser Aluminum Corp.
4.63%, 03/01/28 (a)(b)	25,000	22,143
LSB Industries, Inc.
6.25%, 10/15/28 (a)(b)	60,000	54,927
Mercer International, Inc.
5.13%, 02/01/29 (a)	90,000	73,709
Methanex Corp.
5.13%, 10/15/27 (a)	85,000	79,807
Mineral Resources Ltd.
8.13%, 05/01/27 (a)(b)	5,000	4,995
8.50%, 05/01/30 (a)(b)	75,000	75,362
Minerals Technologies, Inc.
5.00%, 07/01/28 (a)(b)	15,000	13,814
New Gold, Inc.
7.50%, 07/15/27 (a)(b)	25,000	23,900
Novelis Corp.
4.75%, 01/30/30 (a)(b)	100,000	89,595
Nufarm Australia Ltd./Nufarm Americas, Inc.
5.00%, 01/27/30 (a)(b)	25,000	22,297
Olin Corp.
5.13%, 09/15/27 (a)	20,000	19,168
5.63%, 08/01/29 (a)	75,000	72,030
Olympus Water U.S. Holding Corp.
9.75%, 11/15/28 (a)(b)	200,000	201,715
SCIH Salt Holdings, Inc.
4.88%, 05/01/28 (a)(b)	75,000	67,569
SK Invictus Intermediate II Sarl
5.00%, 10/30/29 (a)(b)	15,000	12,337
Taseko Mines Ltd.
7.00%, 02/15/26 (a)(b)	75,000	69,245
The Chemours Co.
5.38%, 05/15/27 (a)	20,000	18,845
5.75%, 11/15/28 (a)(b)	50,000	44,961
4.63%, 11/15/29 (a)(b)	16,000	13,316
Trinseo Materials Operating SCA/Trinseo Materials Finance, Inc.
5.13%, 04/01/29 (a)(b)	20,000	10,823
Tronox, Inc.
4.63%, 03/15/29 (a)(b)	25,000	20,623
United States Steel Corp.
6.88%, 03/01/29 (a)	50,000	49,852
WR Grace Holdings LLC
5.63%, 08/15/29 (a)(b)	100,000	84,660
		2,060,115
Capital Goods 10.0%
Advanced Drainage Systems, Inc.
6.38%, 06/15/30 (a)(b)	50,000	49,300
Alta Equipment Group, Inc.
5.63%, 04/15/26 (a)(b)	10,000	9,264
American Builders & Contractors Supply Co., Inc.
4.00%, 01/15/28 (a)(b)	50,000	45,320

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Amsted Industries, Inc.
5.63%, 07/01/27 (a)(b)	15,000	14,573
Ardagh Metal Packaging Finance USA LLC/Ardagh Metal Packaging Finance plc
4.00%, 09/01/29 (a)(b)	200,000	162,740
Ardagh Packaging Finance plc/Ardagh Holdings USA, Inc.
5.25%, 08/15/27 (a)(b)	200,000	171,557
ATS Corp.
4.13%, 12/15/28 (a)(b)	15,000	13,343
Ball Corp.
5.25%, 07/01/25	40,000	39,482
4.88%, 03/15/26 (a)	55,000	53,483
6.88%, 03/15/28 (a)	50,000	50,802
6.00%, 06/15/29 (a)	25,000	24,676
2.88%, 08/15/30 (a)	50,000	40,948
Beacon Roofing Supply, Inc.
4.13%, 05/15/29 (a)(b)	25,000	21,524
6.50%, 08/01/30 (a)(b)	20,000	19,780
Berry Global, Inc.
5.63%, 07/15/27 (a)(b)	25,000	24,529
Bombardier, Inc.
7.50%, 03/15/25 (a)(b)	10,000	10,017
7.13%, 06/15/26 (a)(b)	50,000	49,214
7.88%, 04/15/27 (a)(b)	150,000	149,773
6.00%, 02/15/28 (a)(b)	50,000	46,777
7.50%, 02/01/29 (a)(b)	25,000	24,520
Builders FirstSource, Inc.
4.25%, 02/01/32 (a)(b)	100,000	85,107
BWX Technologies, Inc.
4.13%, 04/15/29 (a)(b)	35,000	31,176
Chart Industries, Inc.
7.50%, 01/01/30 (a)(b)	50,000	51,295
9.50%, 01/01/31 (a)(b)	10,000	10,777
Clean Harbors, Inc.
4.88%, 07/15/27 (a)(b)	50,000	47,824
6.38%, 02/01/31 (a)(b)	10,000	9,953
Clydesdale Acquisition Holdings, Inc.
8.75%, 04/15/30 (a)(b)	40,000	36,213
Cornerstone Building Brands, Inc.
6.13%, 01/15/29 (a)(b)	30,000	24,391
Covanta Holding Corp.
4.88%, 12/01/29 (a)(b)	25,000	21,524
CP Atlas Buyer, Inc.
7.00%, 12/01/28 (a)(b)	50,000	42,037
Crown Americas LLC/Crown Americas Capital Corp. V
4.25%, 09/30/26 (a)	25,000	23,569
Crown Americas LLC/Crown Americas Capital Corp. VI
4.75%, 02/01/26 (a)	50,000	48,262
Crown Cork & Seal Co., Inc.
7.38%, 12/15/26	4,000	4,161
Eco Material Technologies, Inc.
7.88%, 01/31/27 (a)(b)	10,000	9,760
Emerald Debt Merger Sub LLC
6.63%, 12/15/30 (a)(b)	75,000	73,925
Enviri Corp.
5.75%, 07/31/27 (a)(b)	10,000	8,683
EquipmentShare.com, Inc.
9.00%, 05/15/28 (a)(b)	25,000	24,844
FXI Holdings, Inc.
12.25%, 11/15/26 (a)(b)	50,000	44,935
Gates Global LLC/Gates Corp.
6.25%, 01/15/26 (a)(b)	25,000	24,773

See financial notes

12Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
GFL Environmental, Inc.
4.25%, 06/01/25 (a)(b)	20,000	19,363
5.13%, 12/15/26 (a)(b)	50,000	48,428
4.75%, 06/15/29 (a)(b)	100,000	90,686
Griffon Corp.
5.75%, 03/01/28 (a)	50,000	46,663
H&E Equipment Services, Inc.
3.88%, 12/15/28 (a)(b)	25,000	21,851
Herc Holdings, Inc.
5.50%, 07/15/27 (a)(b)	75,000	72,190
JELD-WEN, Inc.
4.63%, 12/15/25 (a)(b)	50,000	48,517
Knife River Corp.
7.75%, 05/01/31 (a)(b)	35,000	35,869
LABL, Inc.
6.75%, 07/15/26 (a)(b)	50,000	48,926
10.50%, 07/15/27 (a)(b)	25,000	23,956
LBM Acquisition LLC
6.25%, 01/15/29 (a)(b)	50,000	43,686
Madison IAQ LLC
4.13%, 06/30/28 (a)(b)	25,000	22,141
5.88%, 06/30/29 (a)(b)	57,000	48,045
Masonite International Corp.
5.38%, 02/01/28 (a)(b)	25,000	23,714
Mauser Packaging Solutions Holding Co.
7.88%, 08/15/26 (a)(b)	150,000	147,847
9.25%, 04/15/27 (a)(b)	25,000	22,675
MIWD Holdco II LLC/MIWD Finance Corp.
5.50%, 02/01/30 (a)(b)	25,000	21,217
Moog, Inc.
4.25%, 12/15/27 (a)(b)	20,000	18,218
Mueller Water Products, Inc.
4.00%, 06/15/29 (a)(b)	25,000	22,164
NESCO Holdings II, Inc.
5.50%, 04/15/29 (a)(b)	25,000	22,695
OI European Group BV
4.75%, 02/15/30 (a)(b)	10,000	9,125
Oscar AcquisitionCo LLC/Oscar Finance, Inc.
9.50%, 04/15/30 (a)(b)	25,000	23,427
OT Merger Corp.
7.88%, 10/15/29 (a)(b)	10,000	6,573
Owens-Brockway Glass Container, Inc.
6.63%, 05/13/27 (a)(b)	25,000	24,735
7.25%, 05/15/31 (a)(b)	75,000	75,765
Pactiv Evergreen Group Issuer, Inc./Pactiv Evergreen Group Issuer LLC
4.00%, 10/15/27 (a)(b)	50,000	45,016
Park River Holdings, Inc.
6.75%, 08/01/29 (a)(b)	10,000	8,063
Patrick Industries, Inc.
4.75%, 05/01/29 (a)(b)	10,000	8,566
PECF USS Intermediate Holding III Corp.
8.00%, 11/15/29 (a)(b)	20,000	12,775
PGT Innovations, Inc.
4.38%, 10/01/29 (a)(b)	35,000	32,515
Ritchie Bros Holdings, Inc.
6.75%, 03/15/28 (a)(b)	18,000	18,243
7.75%, 03/15/31 (a)(b)	30,000	31,066
Roller Bearing Co. of America, Inc.
4.38%, 10/15/29 (a)(b)	25,000	22,398
Sealed Air Corp.
5.13%, 12/01/24 (a)(b)	15,000	14,808
4.00%, 12/01/27 (a)(b)	100,000	91,614

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Smyrna Ready Mix Concrete LLC
6.00%, 11/01/28 (a)(b)	50,000	48,059
Specialty Building Products Holdings LLC/SBP Finance Corp.
6.38%, 09/30/26 (a)(b)	25,000	23,968
Spirit AeroSystems, Inc.
9.38%, 11/30/29 (a)(b)	100,000	104,336
SPX FLOW, Inc.
8.75%, 04/01/30 (a)(b)	45,000	42,833
SRS Distribution, Inc.
4.63%, 07/01/28 (a)(b)	75,000	66,829
Standard Industries, Inc.
5.00%, 02/15/27 (a)(b)	75,000	71,178
4.75%, 01/15/28 (a)(b)	25,000	23,050
4.38%, 07/15/30 (a)(b)	50,000	42,910
Stericycle, Inc.
3.88%, 01/15/29 (a)(b)	55,000	47,937
Summit Materials LLC/Summit Materials Finance Corp.
5.25%, 01/15/29 (a)(b)	50,000	46,888
Terex Corp.
5.00%, 05/15/29 (a)(b)	25,000	22,977
Titan Acquisition Ltd./Titan Co-Borrower LLC
7.75%, 04/15/26 (a)(b)	25,000	24,325
Titan International, Inc.
7.00%, 04/30/28 (a)	65,000	61,988
TransDigm, Inc.
6.25%, 03/15/26 (a)(b)	225,000	223,075
7.50%, 03/15/27 (a)	15,000	15,042
5.50%, 11/15/27 (a)	150,000	142,488
6.75%, 08/15/28 (a)(b)	21,000	21,100
4.63%, 01/15/29 (a)	75,000	67,313
Trident TPI Holdings, Inc.
12.75%, 12/31/28 (a)(b)	25,000	26,034
Trinity Industries, Inc.
4.55%, 10/01/24 (a)	15,000	14,715
Triumph Group, Inc.
7.75%, 08/15/25 (a)	25,000	23,613
9.00%, 03/15/28 (a)(b)	95,000	95,761
United Rentals North America, Inc.
4.88%, 01/15/28 (a)	30,000	28,573
5.25%, 01/15/30 (a)	25,000	23,782
3.88%, 02/15/31 (a)	175,000	149,846
3.75%, 01/15/32 (a)	5,000	4,209
Vertiv Group Corp.
4.13%, 11/15/28 (a)(b)	50,000	44,934
Waste Pro USA, Inc.
5.50%, 02/15/26 (a)(b)	25,000	23,590
WESCO Distribution, Inc.
7.13%, 06/15/25 (a)(b)	15,000	15,081
7.25%, 06/15/28 (a)(b)	110,000	112,055
White Cap Buyer LLC
6.88%, 10/15/28 (a)(b)	25,000	22,966
		4,599,826
Communications 15.0%
Advantage Sales & Marketing, Inc.
6.50%, 11/15/28 (a)(b)	25,000	21,819
Allen Media LLC/Allen Media Co-Issuer, Inc.
10.50%, 02/15/28 (a)(b)	10,000	5,735
Altice Financing S.A.
5.75%, 08/15/29 (a)(b)	200,000	158,612
Altice France S.A.
8.13%, 02/01/27 (a)(b)	430,000	363,797

See financial notes

Schwab High Yield Bond ETF | Annual Report13

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
AMC Networks, Inc.
4.75%, 08/01/25 (a)	50,000	46,919
4.25%, 02/15/29 (a)	20,000	12,767
Block Communications, Inc.
4.88%, 03/01/28 (a)(b)	5,000	4,143
C&W Senior Financing DAC
6.88%, 09/15/27 (a)(b)	200,000	185,808
CCO Holdings LLC/CCO Holdings Capital Corp.
5.13%, 05/01/27 (a)(b)	305,000	287,003
4.75%, 03/01/30 (a)(b)	225,000	193,656
4.25%, 02/01/31 (a)(b)	300,000	246,355
4.75%, 02/01/32 (a)(b)	80,000	66,273
4.50%, 05/01/32 (a)	135,000	109,567
Clear Channel Outdoor Holdings, Inc.
5.13%, 08/15/27 (a)(b)	75,000	67,245
7.75%, 04/15/28 (a)(b)	50,000	39,372
CMG Media Corp.
8.88%, 12/15/27 (a)(b)	25,000	19,662
Cogent Communications Group, Inc.
3.50%, 05/01/26 (a)(b)	25,000	23,167
Consolidated Communications, Inc.
6.50%, 10/01/28 (a)(b)	35,000	26,902
CSC Holdings LLC
11.25%, 05/15/28 (a)(b)	200,000	197,445
5.75%, 01/15/30 (a)(b)	275,000	152,371
Directv Financing LLC/Directv Financing Co-Obligor, Inc.
5.88%, 08/15/27 (a)(b)	125,000	110,890
DISH DBS Corp.
5.88%, 11/15/24	75,000	69,830
7.75%, 07/01/26	70,000	52,419
5.25%, 12/01/26 (a)(b)	51,000	43,086
7.38%, 07/01/28 (a)	30,000	18,823
5.75%, 12/01/28 (a)(b)	100,000	77,814
5.13%, 06/01/29	25,000	13,540
DISH Network Corp.
11.75%, 11/15/27 (a)(b)	210,000	213,264
Embarq Corp.
8.00%, 06/01/36	47,000	28,673
Frontier Communications Holdings LLC
5.88%, 10/15/27 (a)(b)	52,000	47,408
5.00%, 05/01/28 (a)(b)	115,000	98,646
6.75%, 05/01/29 (a)(b)	19,000	14,766
8.75%, 05/15/30 (a)(b)	85,000	82,698
8.63%, 03/15/31 (a)(b)	25,000	24,099
Frontier Florida LLC
6.86%, 02/01/28	10,000	9,375
GCI LLC
4.75%, 10/15/28 (a)(b)	25,000	21,716
Getty Images, Inc.
9.75%, 03/01/27 (a)(b)	25,000	25,042
Gray Escrow II, Inc.
5.38%, 11/15/31 (a)(b)	105,000	73,400
Gray Television, Inc.
5.88%, 07/15/26 (a)(b)	25,000	22,897
4.75%, 10/15/30 (a)(b)	20,000	13,985
Hughes Satellite Systems Corp.
5.25%, 08/01/26	60,000	55,218
iHeartCommunications, Inc.
6.38%, 05/01/26 (a)	50,000	43,676
5.25%, 08/15/27 (a)(b)	20,000	15,835
4.75%, 01/15/28 (a)(b)	35,000	27,010
Iliad Holding SASU
6.50%, 10/15/26 (a)(b)	200,000	191,017

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
INNOVATE Corp.
8.50%, 02/01/26 (a)(b)	10,000	7,700
Intelsat Jackson Holdings S.A.
6.50%, 03/15/30 (a)(b)	110,000	101,135
Lamar Media Corp.
3.75%, 02/15/28 (a)	68,000	61,996
Level 3 Financing, Inc.
4.63%, 09/15/27 (a)(b)	75,000	56,470
4.25%, 07/01/28 (a)(b)	60,000	39,395
10.50%, 05/15/30 (a)(b)	70,000	71,168
Liberty Interactive LLC
8.50%, 07/15/29	10,000	3,953
8.25%, 02/01/30	15,000	5,841
Lions Gate Capital Holdings LLC
5.50%, 04/15/29 (a)(b)	25,000	15,259
Lumen Technologies, Inc.
4.00%, 02/15/27 (a)(b)	55,000	34,714
4.50%, 01/15/29 (a)(b)	15,000	4,966
7.60%, 09/15/39	12,000	3,574
McGraw-Hill Education, Inc.
5.75%, 08/01/28 (a)(b)	55,000	48,862
8.00%, 08/01/29 (a)(b)	27,000	24,063
Millennium Escrow Corp.
6.63%, 08/01/26 (a)(b)	25,000	20,622
News Corp.
3.88%, 05/15/29 (a)(b)	50,000	43,955
Nexstar Media, Inc.
5.63%, 07/15/27 (a)(b)	90,000	84,676
Northwest Fiber LLC/Northwest Fiber Finance Sub, Inc.
10.75%, 06/01/28 (a)(b)	10,000	9,313
Outfront Media Capital LLC/Outfront Media Capital Corp.
5.00%, 08/15/27 (a)(b)	20,000	18,121
4.63%, 03/15/30 (a)(b)	65,000	52,911
Paramount Global
6.25%, 02/28/57 (a)(c)	10,000	7,840
6.38%, 03/30/62 (a)(c)	55,000	45,424
Qwest Corp.
7.25%, 09/15/25	10,000	9,521
Radiate Holdco LLC/Radiate Finance, Inc.
4.50%, 09/15/26 (a)(b)	30,000	23,412
6.50%, 09/15/28 (a)(b)	37,000	20,021
ROBLOX Corp.
3.88%, 05/01/30 (a)(b)	27,000	22,299
Rogers Communications, Inc.
5.25%, 03/15/82 (a)(b)	30,000	27,239
SBA Communications Corp.
3.88%, 02/15/27 (a)	25,000	23,137
3.13%, 02/01/29 (a)	125,000	107,151
Scripps Escrow II, Inc.
3.88%, 01/15/29 (a)(b)	25,000	20,098
Sinclair Television Group, Inc.
5.50%, 03/01/30 (a)(b)	20,000	10,677
4.13%, 12/01/30 (a)(b)	30,000	19,363
Sirius XM Radio, Inc.
3.13%, 09/01/26 (a)(b)	19,000	17,168
5.00%, 08/01/27 (a)(b)	75,000	69,411
4.00%, 07/15/28 (a)(b)	100,000	86,684
5.50%, 07/01/29 (a)(b)	20,000	18,027
4.13%, 07/01/30 (a)(b)	38,000	31,020
3.88%, 09/01/31 (a)(b)	70,000	54,545
Stagwell Global LLC
5.63%, 08/15/29 (a)(b)	40,000	33,441

See financial notes

14Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
TEGNA, Inc.
4.75%, 03/15/26 (a)(b)	20,000	19,075
4.63%, 03/15/28 (a)	50,000	44,846
5.00%, 09/15/29 (a)	50,000	44,061
Telecom Italia Capital S.A.
6.38%, 11/15/33	135,000	118,756
6.00%, 09/30/34	10,000	8,388
7.20%, 07/18/36	10,000	9,047
Telesat Canada/Telesat LLC
5.63%, 12/06/26 (a)(b)	10,000	7,066
4.88%, 06/01/27 (a)(b)	5,000	3,370
6.50%, 10/15/27 (a)(b)	15,000	7,500
Townsquare Media, Inc.
6.88%, 02/01/26 (a)(b)	20,000	19,269
United States Cellular Corp.
6.70%, 12/15/33	30,000	29,259
Uniti Group LP/Uniti Fiber Holdings, Inc./CSL Capital LLC
6.00%, 01/15/30 (a)(b)	35,000	23,153
Uniti Group LP/Uniti Group Finance, Inc./CSL Capital LLC
10.50%, 02/15/28 (a)(b)	80,000	79,883
4.75%, 04/15/28 (a)(b)	15,000	12,658
6.50%, 02/15/29 (a)(b)	40,000	27,336
Univision Communications, Inc.
6.63%, 06/01/27 (a)(b)	125,000	121,142
8.00%, 08/15/28 (a)(b)	100,000	100,035
4.50%, 05/01/29 (a)(b)	20,000	17,234
7.38%, 06/30/30 (a)(b)	50,000	48,437
UPC Broadband Finco BV
4.88%, 07/15/31 (a)(b)	200,000	165,250
Urban One, Inc.
7.38%, 02/01/28 (a)(b)	50,000	43,523
Viasat, Inc.
5.63%, 09/15/25 (a)(b)	50,000	47,359
Videotron Ltd.
5.13%, 04/15/27 (a)(b)	55,000	52,712
Virgin Media Secured Finance plc
5.50%, 05/15/29 (a)(b)	200,000	183,066
Vmed O2 UK Financing I plc
4.75%, 07/15/31 (a)(b)	200,000	167,362
Vodafone Group plc
7.00%, 04/04/79 (a)(c)	75,000	75,637
3.25%, 06/04/81 (a)(c)	25,000	22,122
4.13%, 06/04/81 (a)(c)	10,000	7,822
5.13%, 06/04/81 (a)(c)	65,000	45,412
Windstream Escrow LLC/Windstream Escrow Finance Corp.
7.75%, 08/15/28 (a)(b)	55,000	44,639
WMG Acquisition Corp.
3.75%, 12/01/29 (a)(b)	75,000	65,093
Zayo Group Holdings, Inc.
4.00%, 03/01/27 (a)(b)	48,000	36,016
6.13%, 03/01/28 (a)(b)	50,000	32,546
Ziggo Bond Co. BV
6.00%, 01/15/27 (a)(b)	200,000	186,196
		6,894,187
Consumer Cyclical 20.5%
1011778 BC ULC/New Red Finance, Inc.
3.50%, 02/15/29 (a)(b)	50,000	43,822
4.00%, 10/15/30 (a)(b)	225,000	190,812
99 Escrow Issuer, Inc.
7.50%, 01/15/26 (a)(b)	30,000	11,979

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Adient Global Holdings Ltd.
7.00%, 04/15/28 (a)(b)	35,000	35,394
8.25%, 04/15/31 (a)(b)	25,000	25,653
Affinity Interactive
6.88%, 12/15/27 (a)(b)	35,000	31,026
Allied Universal Holdco LLC/Allied Universal Finance Corp.
6.63%, 07/15/26 (a)(b)	75,000	71,412
9.75%, 07/15/27 (a)(b)	75,000	68,968
Allied Universal Holdco LLC/Allied Universal Finance Corp./Atlas Luxco 4 Sarl
4.63%, 06/01/28 (a)(b)	200,000	170,180
Allison Transmission, Inc.
3.75%, 01/30/31 (a)(b)	75,000	62,712
AMC Entertainment Holdings, Inc.
7.50%, 02/15/29 (a)(b)	45,000	30,756
American Axle & Manufacturing, Inc.
6.50%, 04/01/27 (a)	75,000	71,152
APX Group, Inc.
5.75%, 07/15/29 (a)(b)	55,000	47,439
Arches Buyer, Inc.
4.25%, 06/01/28 (a)(b)	25,000	21,776
6.13%, 12/01/28 (a)(b)	25,000	21,470
Asbury Automotive Group, Inc.
4.63%, 11/15/29 (a)(b)	70,000	61,825
5.00%, 02/15/32 (a)(b)	16,000	13,741
Ashton Woods USA LLC/Ashton Woods Finance Co.
4.63%, 08/01/29 (a)(b)	25,000	21,687
Aston Martin Capital Holdings Ltd.
10.50%, 11/30/25 (a)(b)	200,000	203,331
Bath & Body Works, Inc.
7.50%, 06/15/29 (a)	65,000	65,593
6.63%, 10/01/30 (a)(b)	25,000	24,406
6.95%, 03/01/33	50,000	46,779
6.88%, 11/01/35	70,000	65,520
Beazer Homes USA, Inc.
7.25%, 10/15/29 (a)	65,000	63,057
Boyd Gaming Corp.
4.75%, 06/15/31 (a)(b)	75,000	66,126
Boyne USA, Inc.
4.75%, 05/15/29 (a)(b)	25,000	22,585
Brookfield Residential Properties, Inc./Brookfield Residential US LLC
5.00%, 06/15/29 (a)(b)	60,000	50,115
4.88%, 02/15/30 (a)(b)	25,000	20,677
Caesars Entertainment, Inc.
6.25%, 07/01/25 (a)(b)	75,000	74,485
8.13%, 07/01/27 (a)(b)	150,000	152,435
4.63%, 10/15/29 (a)(b)	50,000	43,812
Caesars Resort Collection LLC/CRC Finco, Inc.
5.75%, 07/01/25 (a)(b)	25,000	25,040
Carnival Corp.
7.63%, 03/01/26 (a)(b)	40,000	39,918
5.75%, 03/01/27 (a)(b)	250,000	235,503
4.00%, 08/01/28 (a)(b)	100,000	89,571
6.00%, 05/01/29 (a)(b)	25,000	22,594
10.50%, 06/01/30 (a)(b)	130,000	138,584
Carriage Services, Inc.
4.25%, 05/15/29 (a)(b)	25,000	21,717
Carrols Restaurant Group, Inc.
5.88%, 07/01/29 (a)(b)	15,000	12,922
Cars.com, Inc.
6.38%, 11/01/28 (a)(b)	20,000	18,515
Carvana Co.
5.50%, 04/15/27 (a)(b)	41,000	30,167
5.88%, 10/01/28 (a)(b)	25,000	15,404

See financial notes

Schwab High Yield Bond ETF | Annual Report15

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
CCM Merger, Inc.
6.38%, 05/01/26 (a)(b)	10,000	9,729
CDI Escrow Issuer, Inc.
5.75%, 04/01/30 (a)(b)	75,000	69,818
CEC Entertainment LLC
6.75%, 05/01/26 (a)(b)	75,000	71,780
Cedar Fair LP
5.25%, 07/15/29 (a)	50,000	45,054
Cedar Fair LP/Canada's Wonderland Co./Magnum Management Corp./Millennium Op
5.38%, 04/15/27 (a)	15,000	14,194
Century Communities, Inc.
6.75%, 06/01/27 (a)	15,000	14,968
3.88%, 08/15/29 (a)(b)	25,000	21,565
Churchill Downs, Inc.
5.50%, 04/01/27 (a)(b)	19,000	18,322
6.75%, 05/01/31 (a)(b)	30,000	29,386
Cinemark USA, Inc.
5.88%, 03/15/26 (a)(b)	25,000	24,023
5.25%, 07/15/28 (a)(b)	35,000	31,120
Clarios Global LP
6.75%, 05/15/25 (a)(b)	15,000	15,008
Clarios Global LP/Clarios U.S. Finance Co.
6.25%, 05/15/26 (a)(b)	30,000	29,738
8.50%, 05/15/27 (a)(b)	75,000	75,896
6.75%, 05/15/28 (a)(b)	25,000	24,958
CoreCivic, Inc.
8.25%, 04/15/26 (a)	25,000	25,122
Cushman & Wakefield US Borrower LLC
6.75%, 05/15/28 (a)(b)	30,000	28,591
CWT Travel Group, Inc.
8.50%, 11/19/26 (a)(b)	20,000	10,517
Dana, Inc.
4.25%, 09/01/30 (a)	70,000	57,622
Dave & Buster's, Inc.
7.63%, 11/01/25 (a)(b)	25,000	25,271
eG Global Finance plc
6.75%, 02/07/25 (a)(b)	225,000	221,942
Evergreen Acqco 1 LP/TVI, Inc.
9.75%, 04/26/28 (a)(b)	20,000	20,874
Fertitta Entertainment LLC/Fertitta Entertainment Finance Co., Inc.
4.63%, 01/15/29 (a)(b)	25,000	21,649
6.75%, 01/15/30 (a)(b)	50,000	41,334
Foot Locker, Inc.
4.00%, 10/01/29 (a)(b)	15,000	11,304
Ford Motor Co.
4.35%, 12/08/26 (a)	125,000	120,773
6.63%, 10/01/28	15,000	15,136
7.45%, 07/16/31	123,000	129,784
3.25%, 02/12/32 (a)	55,000	42,983
6.10%, 08/19/32 (a)	45,000	43,039
4.75%, 01/15/43	105,000	78,593
7.40%, 11/01/46	15,000	15,359
Ford Motor Credit Co. LLC
7.35%, 11/04/27 (a)	400,000	407,448
Forestar Group, Inc.
3.85%, 05/15/26 (a)(b)	15,000	13,904
5.00%, 03/01/28 (a)(b)	10,000	9,252
Full House Resorts, Inc.
8.25%, 02/15/28 (a)(b)	15,000	13,360
Garda World Security Corp.
4.63%, 02/15/27 (a)(b)	85,000	78,711

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Go Daddy Operating Co. LLC/GD Finance Co., Inc.
3.50%, 03/01/29 (a)(b)	50,000	43,024
Group 1 Automotive, Inc.
4.00%, 08/15/28 (a)(b)	25,000	22,221
GrubHub Holdings, Inc.
5.50%, 07/01/27 (a)(b)	15,000	10,384
Guitar Center, Inc.
8.50%, 01/15/26 (a)(b)	15,000	13,741
Hanesbrands, Inc.
4.88%, 05/15/26 (a)(b)	30,000	28,077
9.00%, 02/15/31 (a)(b)	25,000	25,121
Hilton Domestic Operating Co., Inc.
3.75%, 05/01/29 (a)(b)	25,000	22,047
3.63%, 02/15/32 (a)(b)	190,000	159,067
Hilton Grand Vacations Borrower Escrow LLC/Hilton Grand Vacations Borrower Esc
5.00%, 06/01/29 (a)(b)	65,000	57,685
Hilton Worldwide Finance LLC/Hilton Worldwide Finance Corp.
4.88%, 04/01/27 (a)	20,000	19,293
International Game Technology plc
4.13%, 04/15/26 (a)(b)	200,000	190,028
IRB Holding Corp.
7.00%, 06/15/25 (a)(b)	25,000	25,022
Jacobs Entertainment, Inc.
6.75%, 02/15/29 (a)(b)	25,000	22,679
KB Home
4.00%, 06/15/31 (a)	50,000	42,164
Kohl's Corp.
4.63%, 05/01/31 (a)(d)	25,000	18,429
Las Vegas Sands Corp.
3.50%, 08/18/26 (a)	75,000	69,593
3.90%, 08/08/29 (a)	25,000	22,040
LCM Investments Holdings II LLC
4.88%, 05/01/29 (a)(b)	50,000	43,448
Life Time, Inc.
5.75%, 01/15/26 (a)(b)	25,000	24,414
8.00%, 04/15/26 (a)(b)	20,000	19,868
Light & Wonder International, Inc.
7.00%, 05/15/28 (a)(b)	75,000	74,788
Lindblad Expeditions Holdings, Inc.
9.00%, 05/15/28 (a)(b)	25,000	25,711
Lithia Motors, Inc.
3.88%, 06/01/29 (a)(b)	65,000	55,872
Live Nation Entertainment, Inc.
6.50%, 05/15/27 (a)(b)	25,000	25,042
4.75%, 10/15/27 (a)(b)	105,000	97,912
LSF9 Atlantis Holdings LLC/Victra Finance Corp.
7.75%, 02/15/26 (a)(b)	25,000	22,804
M/I Homes, Inc.
4.95%, 02/01/28 (a)	8,000	7,431
Macy's Retail Holdings LLC
5.88%, 04/01/29 (a)(b)	150,000	135,732
Marriott Ownership Resorts, Inc.
4.50%, 06/15/29 (a)(b)	30,000	25,378
Match Group Holdings II LLC
4.13%, 08/01/30 (a)(b)	77,000	66,106
Mattamy Group Corp.
4.63%, 03/01/30 (a)(b)	50,000	44,243
Matthews International Corp.
5.25%, 12/01/25 (a)(b)	15,000	14,451
Meritage Homes Corp.
3.88%, 04/15/29 (a)(b)	25,000	21,843

See financial notes

16Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Metis Merger Sub LLC
6.50%, 05/15/29 (a)(b)	25,000	21,735
MGM Resorts International
4.75%, 10/15/28 (a)	125,000	113,552
Midwest Gaming Borrower LLC/Midwest Gaming Finance Corp.
4.88%, 05/01/29 (a)(b)	30,000	26,127
Mohegan Tribal Gaming Authority
8.00%, 02/01/26 (a)(b)	65,000	60,590
Murphy Oil USA, Inc.
3.75%, 02/15/31 (a)(b)	50,000	42,105
NCL Corp., Ltd.
3.63%, 12/15/24 (a)(b)	29,000	27,781
5.88%, 03/15/26 (a)(b)	25,000	23,595
5.88%, 02/15/27 (a)(b)	75,000	72,746
8.38%, 02/01/28 (a)(b)	25,000	25,792
7.75%, 02/15/29 (a)(b)	40,000	38,089
NCL Finance Ltd.
6.13%, 03/15/28 (a)(b)	25,000	22,562
NMG Holding Co., Inc./Neiman Marcus Group LLC
7.13%, 04/01/26 (a)(b)	33,000	31,393
Nordstrom, Inc.
4.00%, 03/15/27 (a)	15,000	13,102
6.95%, 03/15/28	10,000	9,728
4.38%, 04/01/30 (a)	20,000	16,000
4.25%, 08/01/31 (a)	15,000	11,298
5.00%, 01/15/44 (a)	45,000	28,620
Penn Entertainment, Inc.
5.63%, 01/15/27 (a)(b)	25,000	23,812
Penske Automotive Group, Inc.
3.50%, 09/01/25 (a)(b)	20,000	19,062
3.75%, 06/15/29 (a)(b)	25,000	21,476
PM General Purchaser LLC
9.50%, 10/01/28 (a)(b)	50,000	48,192
Premier Entertainment Sub LLC/Premier Entertainment Finance Corp.
5.63%, 09/01/29 (a)(b)	55,000	43,950
Prime Security Services Borrower LLC/Prime Finance, Inc.
5.75%, 04/15/26 (b)	40,000	39,291
3.38%, 08/31/27 (a)(b)	35,000	31,161
6.25%, 01/15/28 (a)(b)	50,000	47,674
QVC, Inc.
4.45%, 02/15/25 (a)	37,000	33,303
4.75%, 02/15/27 (a)	20,000	13,222
4.38%, 09/01/28 (a)	10,000	5,668
5.95%, 03/15/43	5,000	2,309
Rakuten Group, Inc.
10.25%, 11/30/24 (b)	200,000	202,000
Real Hero Merger Sub 2, Inc.
6.25%, 02/01/29 (a)(b)	35,000	28,533
Realogy Group LLC/Realogy Co-Issuer Corp.
5.75%, 01/15/29 (a)(b)	25,000	17,934
5.25%, 04/15/30 (a)(b)	25,000	17,380
Rite Aid Corp.
8.00%, 11/15/26 (a)(b)(e)(f)	30,000	19,081
Royal Caribbean Cruises Ltd.
5.38%, 07/15/27 (a)(b)	130,000	122,449
11.63%, 08/15/27 (a)(b)	100,000	109,053
5.50%, 04/01/28 (a)(b)	100,000	93,830
8.25%, 01/15/29 (a)(b)	25,000	26,150
Sally Holdings LLC/Sally Capital, Inc.
5.63%, 12/01/25 (a)	25,000	24,853
Scientific Games Holdings LP/Scientific Games US FinCo, Inc.
6.63%, 03/01/30 (a)(b)	25,000	22,060

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
SeaWorld Parks & Entertainment, Inc.
5.25%, 08/15/29 (a)(b)	25,000	22,469
Service Corp. International
3.38%, 08/15/30 (a)	55,000	45,452
4.00%, 05/15/31 (a)	50,000	42,437
Shea Homes LP/Shea Homes Funding Corp.
4.75%, 02/15/28 (a)	19,000	17,506
Six Flags Entertainment Corp.
5.50%, 04/15/27 (a)(b)	25,000	23,554
7.25%, 05/15/31 (a)(b)	34,000	32,634
Sonic Automotive, Inc.
4.63%, 11/15/29 (a)(b)	50,000	42,798
Sotheby's
7.38%, 10/15/27 (a)(b)	12,000	10,939
Staples, Inc.
7.50%, 04/15/26 (a)(b)	67,000	55,500
10.75%, 04/15/27 (a)(b)	25,000	13,662
Station Casinos LLC
4.50%, 02/15/28 (a)(b)	25,000	22,397
StoneMor, Inc.
8.50%, 05/15/29 (a)(b)	20,000	16,708
Taylor Morrison Communities, Inc.
5.13%, 08/01/30 (a)(b)	50,000	45,906
The ADT Security Corp.
4.13%, 08/01/29 (a)(b)	50,000	43,690
4.88%, 07/15/32 (b)	15,000	12,952
The Brink's Co.
4.63%, 10/15/27 (a)(b)	25,000	23,271
The Gap, Inc.
3.63%, 10/01/29 (a)(b)	75,000	57,164
3.88%, 10/01/31 (a)(b)	10,000	7,256
The Goodyear Tire & Rubber Co.
5.00%, 05/31/26 (a)	40,000	38,635
4.88%, 03/15/27 (a)	95,000	89,452
5.00%, 07/15/29 (a)	50,000	44,425
The Michaels Cos., Inc.
7.88%, 05/01/29 (a)(b)	60,000	41,646
TKC Holdings, Inc.
10.50%, 05/15/29 (a)(b)	35,000	29,081
Travel & Leisure Co.
4.50%, 12/01/29 (a)(b)	75,000	64,618
Tri Pointe Homes, Inc.
5.70%, 06/15/28 (a)	45,000	42,706
Uber Technologies, Inc.
7.50%, 09/15/27 (a)(b)	30,000	30,659
4.50%, 08/15/29 (a)(b)	115,000	105,511
Under Armour, Inc.
3.25%, 06/15/26 (a)	25,000	22,936
Vail Resorts, Inc.
6.25%, 05/15/25 (a)(b)	50,000	49,870
Victoria's Secret & Co.
4.63%, 07/15/29 (a)(b)	35,000	25,373
Viking Cruises Ltd.
5.88%, 09/15/27 (a)(b)	75,000	70,197
9.13%, 07/15/31 (a)(b)	25,000	25,851
VOC Escrow Ltd.
5.00%, 02/15/28 (a)(b)	55,000	51,100
WASH Multifamily Acquisition, Inc.
5.75%, 04/15/26 (a)(b)	25,000	23,207
Wolverine World Wide, Inc.
4.00%, 08/15/29 (a)(b)	25,000	18,748

See financial notes

Schwab High Yield Bond ETF | Annual Report17

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
WW International, Inc.
4.50%, 04/15/29 (a)(b)	16,000	11,094
Wyndham Hotels & Resorts, Inc.
4.38%, 08/15/28 (a)(b)	25,000	22,822
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp.
5.50%, 03/01/25 (a)(b)	21,000	20,764
5.25%, 05/15/27 (a)(b)	13,000	12,316
Wynn Resorts Finance LLC/Wynn Resorts Capital Corp.
5.13%, 10/01/29 (a)(b)	65,000	58,247
7.13%, 02/15/31 (a)(b)	50,000	49,180
Yum! Brands, Inc.
4.75%, 01/15/30 (a)(b)	125,000	115,225
4.63%, 01/31/32 (a)	65,000	58,217
ZF North America Capital, Inc.
4.75%, 04/29/25 (b)	150,000	145,881
ZipRecruiter, Inc.
5.00%, 01/15/30 (a)(b)	25,000	21,000
		9,396,759
Consumer Non-Cyclical 11.4%
Acadia Healthcare Co., Inc.
5.50%, 07/01/28 (a)(b)	25,000	23,709
ACCO Brands Corp.
4.25%, 03/15/29 (a)(b)	35,000	29,933
AdaptHealth LLC
5.13%, 03/01/30 (a)(b)	25,000	20,530
Akumin, Inc.
7.00%, 11/01/25 (a)(b)	25,000	18,906
Albertsons Cos., Inc./Safeway, Inc./New Albertsons LP/Albertsons LLC
7.50%, 03/15/26 (a)(b)	43,000	43,744
4.63%, 01/15/27 (a)(b)	125,000	118,168
3.50%, 03/15/29 (a)(b)	75,000	64,946
AMN Healthcare, Inc.
4.63%, 10/01/27 (a)(b)	50,000	45,914
4.00%, 04/15/29 (a)(b)	10,000	8,562
Aramark Services, Inc.
6.38%, 05/01/25 (a)(b)	116,000	116,300
5.00%, 02/01/28 (a)(b)	5,000	4,669
Avantor Funding, Inc.
4.63%, 07/15/28 (a)(b)	71,000	65,976
B&G Foods, Inc.
5.25%, 04/01/25 (a)	55,000	53,844
Bausch Health Americas, Inc.
9.25%, 04/01/26 (a)(b)	30,000	27,209
8.50%, 01/31/27 (a)(b)	45,000	25,085
Bausch Health Cos., Inc.
5.50%, 11/01/25 (a)(b)	100,000	90,167
9.00%, 12/15/25 (a)(b)	85,000	77,878
4.88%, 06/01/28 (a)(b)	50,000	29,716
11.00%, 09/30/28 (b)	100,000	71,644
5.00%, 02/15/29 (a)(b)	20,000	8,391
5.25%, 02/15/31 (a)(b)	24,000	10,205
BellRing Brands, Inc.
7.00%, 03/15/30 (a)(b)	30,000	30,040
Cano Health LLC
6.25%, 10/01/28 (a)(b)	10,000	3,409
Catalent Pharma Solutions, Inc.
3.13%, 02/15/29 (a)(b)	25,000	21,062
3.50%, 04/01/30 (a)(b)	25,000	21,123
Central Garden & Pet Co.
4.13%, 10/15/30 (a)	25,000	21,540

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Charles River Laboratories International, Inc.
4.00%, 03/15/31 (a)(b)	58,000	50,139
Chobani LLC/Chobani Finance Corp., Inc.
7.50%, 04/15/25 (a)(b)	50,000	49,925
CHS/Community Health Systems, Inc.
8.00%, 03/15/26 (a)(b)	200,000	195,458
5.63%, 03/15/27 (a)(b)	100,000	88,105
6.88%, 04/01/28 (a)(b)	75,000	45,108
6.88%, 04/15/29 (a)(b)	50,000	30,711
6.13%, 04/01/30 (a)(b)	5,000	2,882
4.75%, 02/15/31 (a)(b)	30,000	22,377
Coty Inc/HFC Prestige Products, Inc./HFC Prestige International US LLC
6.63%, 07/15/30 (a)(b)	25,000	25,030
Coty, Inc.
5.00%, 04/15/26 (a)(b)	50,000	48,109
Darling Ingredients, Inc.
5.25%, 04/15/27 (a)(b)	25,000	24,331
6.00%, 06/15/30 (a)(b)	40,000	39,134
DaVita, Inc.
4.63%, 06/01/30 (a)(b)	150,000	128,798
Edgewell Personal Care Co.
5.50%, 06/01/28 (a)(b)	25,000	23,585
4.13%, 04/01/29 (a)(b)	20,000	17,351
Elanco Animal Health, Inc.
6.65%, 08/28/28 (a)(d)	75,000	74,156
Embecta Corp.
5.00%, 02/15/30 (a)(b)	20,000	16,269
Emergent BioSolutions, Inc.
3.88%, 08/15/28 (a)(b)	10,000	4,812
Encompass Health Corp.
4.75%, 02/01/30 (a)	50,000	45,587
4.63%, 04/01/31 (a)	35,000	30,724
Energizer Holdings, Inc.
6.50%, 12/31/27 (a)(b)	15,000	14,507
4.38%, 03/31/29 (a)(b)	50,000	42,881
Fortrea Holdings, Inc.
7.50%, 07/01/30 (a)(b)	50,000	49,000
Garden Spinco Corp.
8.63%, 07/20/30 (a)(b)	10,000	10,685
Global Medical Response, Inc.
6.50%, 10/01/25 (a)(b)	25,000	17,301
Grifols S.A.
4.75%, 10/15/28 (a)(b)	200,000	175,654
Heartland Dental LLC/Heartland Dental Finance Corp.
10.50%, 04/30/28 (a)(b)	35,000	35,394
Herbalife Nutrition Ltd./HLF Financing, Inc.
7.88%, 09/01/25 (a)(b)	25,000	24,080
H-Food Holdings LLC/Hearthside Finance Co., Inc.
8.50%, 06/01/26 (a)(b)	5,000	1,988
HLF Financing Sarl LLC/Herbalife International, Inc.
4.88%, 06/01/29 (a)(b)	25,000	18,728
Hologic, Inc.
3.25%, 02/15/29 (a)(b)	50,000	43,475
Ingles Markets, Inc.
4.00%, 06/15/31 (a)(b)	50,000	41,920
IQVIA, Inc.
5.00%, 10/15/26 (a)(b)	200,000	193,383
Kronos Acquisition Holdings, Inc./KIK Custom Products, Inc.
5.00%, 12/31/26 (a)(b)	25,000	23,341
7.00%, 12/31/27 (a)(b)	50,000	44,052
Lamb Weston Holdings, Inc.
4.13%, 01/31/30 (a)(b)	100,000	88,036

See financial notes

18Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Medline Borrower LP
3.88%, 04/01/29 (a)(b)	220,000	192,264
5.25%, 10/01/29 (a)(b)	50,000	44,451
ModivCare Escrow Issuer, Inc.
5.00%, 10/01/29 (a)(b)	25,000	18,460
ModivCare, Inc.
5.88%, 11/15/25 (a)(b)	5,000	4,749
MPH Acquisition Holdings LLC
5.50%, 09/01/28 (a)(b)	50,000	42,507
5.75%, 11/01/28 (a)(b)	30,000	22,505
Newell Brands, Inc.
4.20%, 04/01/26 (a)(d)	100,000	95,901
6.63%, 09/15/29 (a)	85,000	84,281
Organon & Co./Organon Foreign Debt Co.-Issuer BV
5.13%, 04/30/31 (a)(b)	200,000	170,581
Owens & Minor, Inc.
6.63%, 04/01/30 (a)(b)	25,000	22,766
P&L Development LLC/PLD Finance Corp.
7.75%, 11/15/25 (a)(b)	10,000	8,655
Performance Food Group, Inc.
6.88%, 05/01/25 (a)(b)	10,000	10,024
5.50%, 10/15/27 (a)(b)	5,000	4,819
4.25%, 08/01/29 (a)(b)	75,000	66,076
Pilgrim's Pride Corp.
4.25%, 04/15/31 (a)	17,000	14,723
3.50%, 03/01/32 (a)	25,000	20,155
6.25%, 07/01/33 (a)	75,000	74,520
Post Holdings, Inc.
5.63%, 01/15/28 (a)(b)	125,000	119,973
4.63%, 04/15/30 (a)(b)	55,000	48,779
4.50%, 09/15/31 (a)(b)	10,000	8,624
Prestige Brands, Inc.
3.75%, 04/01/31 (a)(b)	50,000	41,420
Prime Healthcare Services, Inc.
7.25%, 11/01/25 (a)(b)	25,000	23,451
Radiology Partners, Inc.
9.25%, 02/01/28 (a)(b)	25,000	9,841
RegionalCare Hospital Partners Holdings, Inc./LifePoint Health, Inc.
9.75%, 12/01/26 (a)(b)	46,000	43,059
RP Escrow Issuer LLC
5.25%, 12/15/25 (a)(b)	25,000	19,284
Safeway, Inc.
7.25%, 02/01/31	10,000	10,475
Select Medical Corp.
6.25%, 08/15/26 (a)(b)	50,000	49,574
Simmons Foods, Inc./Simmons Prepared Foods, Inc./Simmons Pet Food, Inc./Simmons Feed
4.63%, 03/01/29 (a)(b)	25,000	20,828
Spectrum Brands, Inc.
3.88%, 03/15/31 (a)(b)	25,000	20,968
Surgery Center Holdings, Inc.
10.00%, 04/15/27 (a)(b)	25,000	25,460
Syneos Health, Inc.
3.63%, 01/15/29 (a)(b)	25,000	24,960
Teleflex, Inc.
4.63%, 11/15/27 (a)	15,000	14,160
4.25%, 06/01/28 (a)(b)	15,000	13,810
Tempur Sealy International, Inc.
3.88%, 10/15/31 (a)(b)	75,000	60,340
Tenet Healthcare Corp.
4.88%, 01/01/26 (a)	50,000	48,522
5.13%, 11/01/27 (a)	25,000	23,797

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
4.63%, 06/15/28 (a)	18,000	16,594
6.13%, 10/01/28 (a)	150,000	144,614
4.25%, 06/01/29 (a)	25,000	22,345
4.38%, 01/15/30 (a)	230,000	204,544
6.13%, 06/15/30 (a)	25,000	24,257
6.75%, 05/15/31 (a)(b)	35,000	34,870
6.88%, 11/15/31	15,000	15,023
The Scotts Miracle-Gro Co.
4.50%, 10/15/29 (a)	45,000	37,681
4.00%, 04/01/31 (a)	20,000	15,738
4.38%, 02/01/32 (a)	10,000	7,927
The Toledo Hospital
4.98%, 11/15/45 (a)	20,000	12,135
6.02%, 11/15/48	25,000	17,181
Triton Water Holdings, Inc.
6.25%, 04/01/29 (a)(b)	50,000	42,548
United Natural Foods, Inc.
6.75%, 10/15/28 (a)(b)	15,000	12,503
US Acute Care Solutions LLC
6.38%, 03/01/26 (a)(b)	75,000	65,314
US Foods, Inc.
4.75%, 02/15/29 (a)(b)	100,000	91,362
4.63%, 06/01/30 (a)(b)	5,000	4,449
US Renal Care, Inc.
10.63%, 07/15/27 (a)(b)	5,000	2,037
Valvoline, Inc.
3.63%, 06/15/31 (a)(b)	25,000	19,980
Vector Group Ltd.
5.75%, 02/01/29 (a)(b)	75,000	65,358
Vista Outdoor, Inc.
4.50%, 03/15/29 (a)(b)	25,000	20,859
		5,241,767
Energy 11.1%
Aethon United BR LP/Aethon United Finance Corp.
8.25%, 02/15/26 (a)(b)	75,000	75,442
AmeriGas Partners LP/AmeriGas Finance Corp.
5.50%, 05/20/25 (a)	25,000	24,558
5.75%, 05/20/27 (a)	75,000	69,436
Antero Midstream Partners LP/Antero Midstream Finance Corp.
5.75%, 03/01/27 (a)(b)	10,000	9,701
5.38%, 06/15/29 (a)(b)	75,000	70,354
Antero Resources Corp.
5.38%, 03/01/30 (a)(b)	50,000	46,801
Archrock Partners LP/Archrock Partners Finance Corp.
6.25%, 04/01/28 (a)(b)	39,000	37,266
Ascent Resources Utica Holdings LLC/ARU Finance Corp.
7.00%, 11/01/26 (a)(b)	25,000	24,876
Baytex Energy Corp.
8.75%, 04/01/27 (a)(b)	50,000	51,221
8.50%, 04/30/30 (a)(b)	30,000	30,447
Blue Racer Midstream LLC/Blue Racer Finance Corp.
7.63%, 12/15/25 (a)(b)	50,000	50,190
Bristow Group, Inc.
6.88%, 03/01/28 (a)(b)	25,000	23,408
Buckeye Partners LP
4.13%, 03/01/25 (a)(b)	15,000	14,459
3.95%, 12/01/26 (a)	75,000	69,244
4.50%, 03/01/28 (a)(b)	15,000	13,626
5.85%, 11/15/43 (a)	25,000	19,434
California Resources Corp.
7.13%, 02/01/26 (a)(b)	25,000	25,087

See financial notes

Schwab High Yield Bond ETF | Annual Report19

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Callon Petroleum Co.
8.00%, 08/01/28 (a)(b)	50,000	50,751
7.50%, 06/15/30 (a)(b)	25,000	24,736
Calumet Specialty Products Partners LP/Calumet Finance Corp.
11.00%, 04/15/25 (a)(b)	25,000	25,655
8.13%, 01/15/27 (a)(b)	25,000	23,917
Chesapeake Energy Corp.
6.75%, 04/15/29 (a)(b)	75,000	74,530
Chord Energy Corp.
6.38%, 06/01/26 (a)(b)	25,000	24,664
CITGO Holding, Inc.
9.25%, 08/01/24 (a)(b)	55,000	55,061
CITGO Petroleum Corp.
6.38%, 06/15/26 (a)(b)	55,000	53,760
Civitas Resources, Inc.
5.00%, 10/15/26 (a)(b)	50,000	47,498
8.75%, 07/01/31 (a)(b)	43,000	44,559
CNX Resources Corp.
7.38%, 01/15/31 (a)(b)	50,000	49,956
Comstock Resources, Inc.
6.75%, 03/01/29 (a)(b)	60,000	56,195
Crescent Energy Finance LLC
9.25%, 02/15/28 (a)(b)	12,000	12,286
Crestwood Midstream Partners LP/Crestwood Midstream Finance Corp.
6.00%, 02/01/29 (a)(b)	75,000	73,706
7.38%, 02/01/31 (a)(b)	25,000	25,780
CrownRock LP/CrownRock Finance, Inc.
5.63%, 10/15/25 (a)(b)	53,000	52,211
CVR Energy, Inc.
5.75%, 02/15/28 (a)(b)	50,000	45,571
DT Midstream, Inc.
4.13%, 06/15/29 (a)(b)	85,000	75,392
4.38%, 06/15/31 (a)(b)	5,000	4,334
Earthstone Energy Holdings LLC
8.00%, 04/15/27 (a)(b)	75,000	76,620
Encino Acquisition Partners Holdings LLC
8.50%, 05/01/28 (a)(b)	29,000	27,524
Endeavor Energy Resources LP/EER Finance, Inc.
5.75%, 01/30/28 (a)(b)	30,000	29,375
EnLink Midstream LLC
5.38%, 06/01/29 (a)	15,000	14,316
6.50%, 09/01/30 (a)(b)	75,000	75,276
EnLink Midstream Partners LP
5.60%, 04/01/44 (a)	15,000	12,805
5.05%, 04/01/45 (a)	15,000	11,978
5.45%, 06/01/47 (a)	50,000	41,549
EQM Midstream Partners LP
7.50%, 06/01/27 (a)(b)	50,000	50,512
6.50%, 07/01/27 (a)(b)	75,000	74,593
4.50%, 01/15/29 (a)(b)	25,000	22,739
4.75%, 01/15/31 (a)(b)	75,000	66,353
Ferrellgas LP/Ferrellgas Finance Corp.
5.88%, 04/01/29 (a)(b)	60,000	52,992
Genesis Energy LP/Genesis Energy Finance Corp.
6.25%, 05/15/26 (a)	100,000	97,087
8.00%, 01/15/27 (a)	75,000	74,014
Global Marine, Inc.
7.00%, 06/01/28	25,000	21,731
Global Partners LP/GLP Finance Corp.
6.88%, 01/15/29 (a)	15,000	14,189
Harvest Midstream I LP
7.50%, 09/01/28 (a)(b)	25,000	25,085

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Hess Midstream Operations LP
5.63%, 02/15/26 (a)(b)	10,000	9,795
4.25%, 02/15/30 (a)(b)	50,000	44,009
5.50%, 10/15/30 (a)(b)	15,000	14,058
Hilcorp Energy I LP/Hilcorp Finance Co.
6.00%, 02/01/31 (a)(b)	100,000	91,978
6.25%, 04/15/32 (a)(b)	10,000	9,187
Holly Energy Partners LP/Holly Energy Finance Corp.
5.00%, 02/01/28 (a)(b)	25,000	23,474
Howard Midstream Energy Partners LLC
8.88%, 07/15/28 (a)(b)	20,000	20,731
ITT Holdings LLC
6.50%, 08/01/29 (a)(b)	70,000	63,241
Kinetik Holdings LP
5.88%, 06/15/30 (a)(b)	40,000	38,785
Matador Resources Co.
5.88%, 09/15/26 (a)	50,000	48,812
MEG Energy Corp.
5.88%, 02/01/29 (a)(b)	50,000	47,814
Moss Creek Resources Holdings, Inc.
7.50%, 01/15/26 (a)(b)	50,000	47,911
10.50%, 05/15/27 (a)(b)	25,000	24,831
Murphy Oil Corp.
6.38%, 07/15/28 (a)	75,000	75,029
Nabors Industries, Inc.
7.38%, 05/15/27 (a)(b)	75,000	73,260
New Fortress Energy, Inc.
6.75%, 09/15/25 (a)(b)	35,000	33,863
6.50%, 09/30/26 (a)(b)	50,000	46,521
NGL Energy Operating LLC/NGL Energy Finance Corp.
7.50%, 02/01/26 (a)(b)	85,000	84,700
NGL Energy Partners LP/NGL Energy Finance Corp.
7.50%, 04/15/26 (a)	20,000	19,248
Nine Energy Service, Inc.
13.00%, 02/01/28 (a)	5,000	4,568
Noble Finance II LLC
8.00%, 04/15/30 (a)(b)	25,000	25,875
Northern Oil & Gas, Inc.
8.13%, 03/01/28 (a)(b)	100,000	100,331
Northriver Midstream Finance LP
5.63%, 02/15/26 (a)(b)	25,000	24,062
NuStar Logistics LP
6.00%, 06/01/26 (a)	35,000	34,339
6.38%, 10/01/30 (a)	50,000	48,173
Oceaneering International, Inc.
4.65%, 11/15/24 (a)	15,000	14,700
6.00%, 02/01/28 (a)	15,000	14,119
Parkland Corp.
4.50%, 10/01/29 (a)(b)	75,000	66,159
Patterson-UTI Energy, Inc.
3.95%, 02/01/28 (a)	25,000	22,959
5.15%, 11/15/29 (a)	15,000	13,835
PBF Holding Co. LLC/PBF Finance Corp.
7.25%, 06/15/25 (a)	25,000	25,024
6.00%, 02/15/28 (a)	34,000	32,192
PDC Energy, Inc.
5.75%, 05/15/26 (a)	50,000	49,906
Permian Resources Operating LLC
5.88%, 07/01/29 (a)(b)	50,000	48,274
Petrofac Ltd.
9.75%, 11/15/26 (a)(b)	20,000	15,369

See financial notes

20Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Range Resources Corp.
8.25%, 01/15/29 (a)	50,000	51,953
4.75%, 02/15/30 (a)(b)	10,000	9,040
Rockcliff Energy II LLC
5.50%, 10/15/29 (a)(b)	75,000	69,214
Rockies Express Pipeline LLC
3.60%, 05/15/25 (a)(b)	10,000	9,442
4.95%, 07/15/29 (a)(b)	50,000	45,815
4.80%, 05/15/30 (a)(b)	20,000	17,506
SM Energy Co.
6.63%, 01/15/27 (a)	25,000	24,710
6.50%, 07/15/28 (a)	25,000	24,460
Southwestern Energy Co.
4.75%, 02/01/32 (a)	105,000	93,129
Suburban Propane Partners LP/Suburban Energy Finance Corp.
5.00%, 06/01/31 (a)(b)	30,000	25,817
Summit Midstream Holdings LLC/Summit Midstream Finance Corp.
9.00%, 10/15/26 (a)(b)(d)	25,000	24,148
Sunoco LP/Sunoco Finance Corp.
5.88%, 03/15/28 (a)	15,000	14,583
4.50%, 05/15/29 (a)	50,000	45,267
4.50%, 04/30/30 (a)	25,000	22,314
Tallgrass Energy Partners LP/Tallgrass Energy Finance Corp.
6.00%, 03/01/27 (a)(b)	25,000	23,986
5.50%, 01/15/28 (a)(b)	25,000	23,250
6.00%, 12/31/30 (a)(b)	25,000	22,394
6.00%, 09/01/31 (a)(b)	50,000	44,455
Talos Production, Inc.
12.00%, 01/15/26 (a)	25,000	26,088
Transocean Poseidon Ltd.
6.88%, 02/01/27 (a)(b)	37,500	37,301
Transocean, Inc.
11.50%, 01/30/27 (a)(b)	50,000	52,828
8.00%, 02/01/27 (a)(b)	22,000	21,483
8.75%, 02/15/30 (a)(b)	42,750	43,774
6.80%, 03/15/38	50,000	39,000
USA Compression Partners LP/USA Compression Finance Corp.
6.88%, 04/01/26 (a)	25,000	24,742
6.88%, 09/01/27 (a)	60,000	58,556
Valaris Ltd.
8.38%, 04/30/30 (a)(b)	30,000	30,585
Venture Global Calcasieu Pass LLC
6.25%, 01/15/30 (a)(b)	50,000	48,764
4.13%, 08/15/31 (a)(b)	10,000	8,493
3.88%, 11/01/33 (a)(b)	110,000	89,485
Venture Global LNG, Inc.
8.13%, 06/01/28 (a)(b)	75,000	75,723
8.38%, 06/01/31 (a)(b)	130,000	131,253
Vermilion Energy, Inc.
6.88%, 05/01/30 (a)(b)	25,000	23,694
Vital Energy, Inc.
9.50%, 01/15/25 (a)	25,000	25,151
7.75%, 07/31/29 (a)(b)	15,000	13,514
W&T Offshore, Inc.
11.75%, 02/01/26 (a)(b)	10,000	10,134
Weatherford International Ltd.
8.63%, 04/30/30 (a)(b)	100,000	102,517
		5,076,550
Industrial Other 1.4%
AECOM
5.13%, 03/15/27 (a)	50,000	48,019

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
APi Group DE, Inc.
4.13%, 07/15/29 (a)(b)	30,000	25,929
Artera Services LLC
9.03%, 12/04/25 (a)(b)	25,000	23,285
Brand Industrial Services, Inc.
10.38%, 08/01/30 (a)(b)	50,000	51,626
Brundage-Bone Concrete Pumping Holdings, Inc.
6.00%, 02/01/26 (a)(b)	50,000	48,049
Fluor Corp.
4.25%, 09/15/28 (a)	50,000	46,672
Global Infrastructure Solutions, Inc.
7.50%, 04/15/32 (a)(b)	20,000	17,428
Grand Canyon University
4.13%, 10/01/24	90,000	85,369
Great Lakes Dredge & Dock Corp.
5.25%, 06/01/29 (a)(b)	60,000	51,460
Hillenbrand, Inc.
4.50%, 09/15/26 (a)(d)	15,000	14,607
Pike Corp.
5.50%, 09/01/28 (a)(b)	50,000	45,048
TopBuild Corp.
4.13%, 02/15/32 (a)(b)	50,000	41,670
Vericast Corp.
11.00%, 09/15/26 (a)(b)	105,000	109,864
12.50%, 12/15/27 (a)(b)	10,000	11,337
Williams Scotsman International, Inc.
4.63%, 08/15/28 (a)(b)	50,000	45,670
		666,033
Technology 6.9%
Alteryx, Inc.
8.75%, 03/15/28 (a)(b)	50,000	48,295
AthenaHealth Group, Inc.
6.50%, 02/15/30 (a)(b)	80,000	69,552
Block, Inc.
2.75%, 06/01/26 (a)	20,000	18,206
3.50%, 06/01/31 (a)	50,000	41,047
Boxer Parent Co., Inc.
7.13%, 10/02/25 (a)(b)	25,000	25,054
Camelot Finance S.A.
4.50%, 11/01/26 (a)(b)	25,000	23,407
Castle US Holding Corp.
9.50%, 02/15/28 (a)(b)	10,000	5,494
Central Parent, Inc./CDK Global, Inc.
7.25%, 06/15/29 (a)(b)	25,000	24,683
Clarivate Science Holdings Corp.
4.88%, 07/01/29 (a)(b)	65,000	56,743
Cloud Software Group, Inc.
6.50%, 03/31/29 (a)(b)	155,000	138,780
9.00%, 09/30/29 (a)(b)	130,000	116,339
Coherent Corp.
5.00%, 12/15/29 (a)(b)	50,000	44,460
CommScope Technologies LLC
6.00%, 06/15/25 (a)(b)	140,000	128,275
5.00%, 03/15/27 (a)(b)	25,000	13,925
CommScope, Inc.
4.75%, 09/01/29 (a)(b)	65,000	48,362
Conduent Business Services LLC/Conduent State & Local Solutions, Inc.
6.00%, 11/01/29 (a)(b)	25,000	20,657
Consensus Cloud Solutions, Inc.
6.50%, 10/15/28 (a)(b)	50,000	45,236

See financial notes

Schwab High Yield Bond ETF | Annual Report21

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
CoreLogic, Inc.
4.50%, 05/01/28 (a)(b)	25,000	20,460
Crowdstrike Holdings, Inc.
3.00%, 02/15/29 (a)	45,000	38,731
Entegris Escrow Corp.
4.75%, 04/15/29 (a)(b)	25,000	23,284
5.95%, 06/15/30 (a)(b)	50,000	47,933
Entegris, Inc.
4.38%, 04/15/28 (a)(b)	25,000	22,815
3.63%, 05/01/29 (a)(b)	15,000	12,906
Fair Isaac Corp.
4.00%, 06/15/28 (a)(b)	75,000	68,655
Gartner, Inc.
3.75%, 10/01/30 (a)(b)	100,000	86,454
Gen Digital, Inc.
5.00%, 04/15/25 (a)(b)	20,000	19,625
6.75%, 09/30/27 (a)(b)	75,000	75,270
GoTo Group, Inc.
5.50%, 09/01/27 (a)(b)	10,000	5,863
HealthEquity, Inc.
4.50%, 10/01/29 (a)(b)	25,000	22,201
Imola Merger Corp.
4.75%, 05/15/29 (a)(b)	105,000	93,437
Iron Mountain Information Management Services, Inc.
5.00%, 07/15/32 (a)(b)	35,000	30,256
Iron Mountain, Inc.
7.00%, 02/15/29 (a)(b)	125,000	124,788
5.25%, 07/15/30 (a)(b)	150,000	135,493
McAfee Corp.
7.38%, 02/15/30 (a)(b)	75,000	65,686
Mobius Merger Sub, Inc.
9.00%, 06/01/30 (a)(b)	15,000	13,691
NCR Corp.
5.13%, 04/15/29 (a)(b)	135,000	122,902
Neptune Bidco U.S., Inc.
9.29%, 04/15/29 (a)(b)	125,000	116,840
ON Semiconductor Corp.
3.88%, 09/01/28 (a)(b)	10,000	8,911
Open Text Corp.
3.88%, 02/15/28 (a)(b)	25,000	22,271
Open Text Holdings, Inc.
4.13%, 02/15/30 (a)(b)	115,000	99,206
Paysafe Finance plc/Paysafe Holdings US Corp.
4.00%, 06/15/29 (a)(b)	15,000	12,728
Pitney Bowes, Inc.
6.88%, 03/15/27 (a)(b)	30,000	22,679
Presidio Holdings, Inc.
8.25%, 02/01/28 (a)(b)	50,000	48,495
PTC, Inc.
4.00%, 02/15/28 (a)(b)	50,000	45,983
Rackspace Technology Global, Inc.
3.50%, 02/15/28 (a)(b)	15,000	7,133
5.38%, 12/01/28 (a)(b)	5,000	1,458
Rocket Software, Inc.
6.50%, 02/15/29 (a)(b)	25,000	20,773
Sabre Global, Inc.
7.38%, 09/01/25 (a)(b)	75,000	73,781
Seagate HDD Cayman
8.25%, 12/15/29 (a)(b)	75,000	78,751
9.63%, 12/01/32 (a)(b)	100,000	110,882

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Sensata Technologies BV
5.00%, 10/01/25 (b)	35,000	34,145
4.00%, 04/15/29 (a)(b)	35,000	30,776
Sensata Technologies, Inc.
3.75%, 02/15/31 (a)(b)	100,000	83,890
SS&C Technologies, Inc.
5.50%, 09/30/27 (a)(b)	75,000	72,270
The Dun & Bradstreet Corp.
5.00%, 12/15/29 (a)(b)	25,000	22,460
Twilio, Inc.
3.88%, 03/15/31 (a)	40,000	33,541
Veritas US, Inc./Veritas Bermuda Ltd.
7.50%, 09/01/25 (a)(b)	50,000	41,016
Verscend Escrow Corp.
9.75%, 08/15/26 (a)(b)	100,000	99,591
Western Digital Corp.
4.75%, 02/15/26 (a)	100,000	95,441
Xerox Corp.
4.80%, 03/01/35	15,000	10,145
6.75%, 12/15/39	25,000	19,506
Xerox Holdings Corp.
5.00%, 08/15/25 (a)(b)	50,000	47,747
Ziff Davis, Inc.
4.63%, 10/15/30 (a)(b)	15,000	12,916
ZoomInfo Technologies LLC/ZoomInfo Finance Corp.
3.88%, 02/01/29 (a)(b)	10,000	8,510
		3,180,810
Transportation 2.5%
Air Canada
3.88%, 08/15/26 (a)(b)	50,000	46,223
Allegiant Travel Co.
7.25%, 08/15/27 (a)(b)	50,000	48,990
American Airlines Group, Inc.
3.75%, 03/01/25 (b)	25,000	23,948
American Airlines, Inc.
11.75%, 07/15/25 (b)	175,000	191,705
7.25%, 02/15/28 (a)(b)	65,000	63,916
American Airlines, Inc./AAdvantage Loyalty IP Ltd.
5.50%, 04/20/26 (b)	50,417	49,526
5.75%, 04/20/29 (b)	15,000	14,361
Avis Budget Car Rental LLC/Avis Budget Finance, Inc.
4.75%, 04/01/28 (a)(b)	75,000	68,276
Delta Air Lines, Inc.
2.90%, 10/28/24 (a)	15,000	14,543
7.38%, 01/15/26 (a)	25,000	25,747
3.75%, 10/28/29 (a)	50,000	44,542
First Student Bidco, Inc./First Transit Parent, Inc.
4.00%, 07/31/29 (a)(b)	60,000	51,085
Hawaiian Brand Intellectual Property Ltd./HawaiianMiles Loyalty Ltd.
5.75%, 01/20/26 (a)(b)	60,000	55,578
Rand Parent LLC
8.50%, 02/15/30 (a)(b)	35,000	33,369
Spirit Loyalty Cayman Ltd./Spirit IP Cayman Ltd.
8.00%, 09/20/25 (a)(b)	50,000	50,099
The Hertz Corp.
4.63%, 12/01/26 (a)(b)	10,000	9,063
5.00%, 12/01/29 (a)(b)	75,000	61,735
United Airlines, Inc.
4.38%, 04/15/26 (a)(b)	60,000	56,606
4.63%, 04/15/29 (a)(b)	80,000	71,238

See financial notes

22Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Portfolio Holdings as of August 31, 2023 (continued)

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
VistaJet Malta Finance plc/Vista Management Holding, Inc.
7.88%, 05/01/27 (a)(b)	25,000	22,650
9.50%, 06/01/28 (a)(b)	85,000	78,520
Watco Cos. LLC/Watco Finance Corp.
6.50%, 06/15/27 (a)(b)	25,000	24,155
XPO CNW, Inc.
6.70%, 05/01/34	25,000	24,876
XPO, Inc.
7.13%, 06/01/31 (a)(b)	25,000	25,160
		1,155,911
		38,271,958

Utility 3.0%
Electric 3.0%
Algonquin Power & Utilities Corp.
4.75%, 01/18/82 (a)(c)	35,000	28,660
Calpine Corp.
4.50%, 02/15/28 (a)(b)	130,000	120,461
5.13%, 03/15/28 (a)(b)	75,000	68,399
5.00%, 02/01/31 (a)(b)	33,000	27,953
Clearway Energy Operating LLC
3.75%, 02/15/31 (a)(b)	100,000	82,308
DPL, Inc.
4.13%, 07/01/25 (a)	50,000	47,610
Edison International
8.13%, 06/15/53 (a)(c)	45,000	45,883
Emera, Inc.
6.75%, 06/15/76 (a)(c)	60,000	57,825
FirstEnergy Corp.
4.15%, 07/15/27 (a)(d)	75,000	70,814
2.65%, 03/01/30 (a)	125,000	104,863
4.85%, 07/15/47 (a)(d)	25,000	21,778
NextEra Energy Operating Partners LP
3.88%, 10/15/26 (a)(b)	15,000	13,875
NOVA Chemicals Corp.
5.00%, 05/01/25 (a)(b)	22,000	20,966
5.25%, 06/01/27 (a)(b)	65,000	57,863
NRG Energy, Inc.
5.25%, 06/15/29 (a)(b)	10,000	9,010
3.88%, 02/15/32 (a)(b)	150,000	116,193
Pattern Energy Operations LP/Pattern Energy Operations, Inc.
4.50%, 08/15/28 (a)(b)	20,000	18,226
PG&E Corp.
5.25%, 07/01/30 (a)	75,000	66,701
Sunnova Energy Corp.
5.88%, 09/01/26 (a)(b)	50,000	44,043

SECURITY RATE, MATURITY DATE	FACE AMOUNT ($)	VALUE ($)
Talen Energy Supply LLC
8.63%, 06/01/30 (a)(b)	60,000	62,536
Terraform Global Operating LP
6.13%, 03/01/26 (a)(b)	25,000	24,060
TerraForm Power Operating LLC
4.75%, 01/15/30 (a)(b)	45,000	38,622
Topaz Solar Farms LLC
5.75%, 09/30/39 (b)	25,000	23,662
TransAlta Corp.
6.50%, 03/15/40	10,000	9,568
Vistra Operations Co. LLC
5.63%, 02/15/27 (a)(b)	25,000	24,090
5.00%, 07/31/27 (a)(b)	185,000	174,161
		1,380,130
Total Corporates (Cost $43,857,795)		44,040,281

SECURITY	NUMBER OF SHARES	VALUE ($)
SHORT-TERM INVESTMENTS 2.0% OF NET ASSETS

Money Market Funds 2.0%
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.28% (g)	934,921	934,921
Total Short-Term Investments (Cost $934,921)		934,921
Total Investments in Securities (Cost $44,792,716)		44,975,202

(a)	The effective maturity may be shorter than the final maturity shown because of the possibility of interim principal payments and prepayments or as the result of embedded demand features (puts or calls).
(b)	Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $34,557,731 or 75.3% of net assets.
(c)	Security is in a fixed-rate coupon period. Based on index eligibility requirements and the fund’s investment objective this security will be removed from the index prior to converting to a floating rate security.
(d)	Step up security that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end.
(e)	On October 15, 2023, the issuer filed for bankruptcy. The security was subsequently sold.
(f)	Security is in default on interest payments.
(g)	The rate shown is the annualized 7-day yield.

See financial notes

Schwab High Yield Bond ETF | Annual Report23

Schwab High Yield Bond ETF

Financial Notes

1. Business Structure of the Fund:

Schwab High Yield Bond ETF is a series of Schwab Strategic Trust (the trust), a no-load, open-end management investment company. The trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the operational funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

SCHWAB STRATEGIC TRUST (ORGANIZED JANUARY 27, 2009)
Schwab High Yield Bond ETF	Schwab U.S. TIPS ETF
Schwab Municipal Bond ETF	Schwab Short-Term U.S. Treasury ETF
Schwab U.S. Broad Market ETF	Schwab Intermediate-Term U.S. Treasury ETF
Schwab 1000 Index®ETF	Schwab Long-Term U.S. Treasury ETF
Schwab U.S. Large-Cap ETF	Schwab U.S. Aggregate Bond ETF
Schwab U.S. Large-Cap Growth ETF	Schwab 1-5 Year Corporate Bond ETF
Schwab U.S. Large-Cap Value ETF	Schwab 5-10 Year Corporate Bond ETF
Schwab U.S. Mid-Cap ETF	Schwab Fundamental U.S. Broad Market Index ETF
Schwab U.S. Small-Cap ETF	Schwab Fundamental U.S. Large Company Index ETF
Schwab U.S. Dividend Equity ETF	Schwab Fundamental U.S. Small Company Index ETF
Schwab International Dividend Equity ETF	Schwab Fundamental International Large Company Index ETF
Schwab International Equity ETF	Schwab Fundamental International Small Company Index ETF
Schwab International Small-Cap Equity ETF	Schwab Fundamental Emerging Markets Large Company Index ETF
Schwab Emerging Markets Equity ETF	Schwab Ariel ESG ETF
Schwab U.S. REIT ETF	Schwab Crypto Thematic ETF

The fund issues and redeems shares at its net asset value per share (NAV) only in large blocks of shares (Creation Units). These transactions are usually in exchange for a basket of securities and/or an amount of cash. As a practical matter, only institutional investors who have entered into an authorized participant agreement purchase or redeem Creation Units. Except when aggregated in Creation Units, shares of the fund are not redeemable securities.

Individual shares of the fund trade on national securities exchanges and elsewhere during the trading day and can only be bought and sold at market prices throughout the trading day through a broker-dealer. Because fund shares trade at market prices rather than NAV, shares may trade at a price greater than NAV (premium) or less than NAV (discount). A chart showing the frequency at which the fund’s daily closing market price was at a discount or premium to the fund’s NAV can be found at www.schwabassetmanagement.com.

Schwab High Yield Bond ETF commenced operations on July 11, 2023.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).

The fund may invest in certain mutual funds, which are referred to as "underlying funds". For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the U.S. Securities and Exchange Commission (SEC) and are available on the SEC’s website at www.sec.gov.

(a) Security Valuation

Pursuant to Rule 2a-5 under the 1940 Act, the Board of Trustees (the Board) has designated authority to a Valuation Designee, the fund’s investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities as well as to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

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Schwab High Yield Bond ETF

Financial Notes (continued)

2. Significant Accounting Policies (continued):

Securities held in the fund’s portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:

• Bonds and notes: Fixed income investments are generally valued using an evaluated price at the mid-point of the bid/ask spread provided by an approved, independent pricing service (mid-price). To determine the evaluated mid-price, a pricing service may use a variety of techniques and inputs. Techniques may include, but are not limited to, spread models that calculate an investment-specific price relative to a benchmark or yield curve models that establish a price based on yields of comparable bonds along a range of maturities. Inputs differ by valuation approach and technique, as appropriate, and examples of inputs may include, but are not limited to, interest rates, market conditions, comparable bonds, market trades, projected cash flows, credit reviews and issuer news.

• Short-term securities (60 days or less to maturity): Securities with remaining maturities of 60 days or less are generally valued at an evaluated price; however, such securities may be valued at their amortized cost if it approximates the security’s fair value.

• Mutual funds: Mutual funds are valued at their respective NAVs.

• Securities for which no quoted value is available: The Valuation Designee has adopted procedures to fair value the fund’s securities when market prices are not “readily available” or are unreliable. For example, a security may be fair valued when it’s de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and Valuation Designee’s judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

• Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets. These generally include active listed equities, mutual funds, exchange-traded funds (ETFs) and futures contracts. Mutual funds and ETFs are classified as Level 1 prices, without consideration to the classification level of the underlying securities held.

• Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.

• Level 3 — significant unobservable inputs (including the Valuation Designee’s assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash

Schwab High Yield Bond ETF | Annual Report29

Schwab High Yield Bond ETF

Financial Notes (continued)

2. Significant Accounting Policies (continued):

flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore a fund’s results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund’s investments as of August 31, 2023, are disclosed in the fund’s Portfolio Holdings.

(b) Accounting Policies for certain Portfolio Investments (if held):

Delayed-Delivery Transactions and When-Issued Securities: The fund may transact in securities on a delayed-delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed-delivery or when-issued basis are identified as such in the fund’s Portfolio Holdings, if any. The fund may receive compensation for interest forgone in the purchase of a delayed-delivery or when-issued security. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract’s terms, or if the issuer does not issue the securities due to political, economic, or other factors. The fund complies with Rule 18f-4 under the 1940 Act, the fund operates as a limited derivatives user, with respect to purchase commitments held within the fund, portfolio securities are no longer required to be segregated as collateral with a value at least equal to the amount of a purchase commitment and the fund’s exposure is monitored under a derivatives risk management program.

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.

(d) Investment Income:

Interest income is recorded as it accrues. If the fund buys a debt security at a discount (less than face value) or a premium (more than face value), it amortizes premiums and accretes discounts from the purchase settlement date up to maturity. The fund then increases (in the case of discounts) or reduces (in the case of premiums) the income it records from the security. Certain securities may be callable (meaning that the issuer has the option to pay it off before its maturity date). The fund amortizes the premium and accretes the discount on each callable security to the security’s maturity date, except when the purchase price is higher than the call price at the security’s call date (in which case the premium is amortized to the call date). Debt securities may be placed on non-accrual status and set to accrue at a rate of interest less than the contractual coupon or have the interest receivable written off when the collection of all or a portion of interest has become doubtful.

(e) Expenses:

Pursuant to the Amended and Restated Advisory Agreement (Advisory Agreement) between the investment adviser and the trust, the investment adviser will pay the operating expenses of the fund, excluding taxes, any brokerage expenses, and extraordinary or non-routine expenses. Taxes, any brokerage expenses and extraordinary or non-routine expenses that are specific to the fund are charged directly to the fund. The Advisory Agreement excludes paying acquired fund fees and expenses, which are indirect expenses incurred by a fund through its investments in underlying funds.

(f) Distributions to Shareholders:

The fund makes distributions from net investment income, if any, monthly and from net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.

(g) Accounting Estimates:

The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It’s possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.

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Schwab High Yield Bond ETF

Financial Notes (continued)

2. Significant Accounting Policies (continued):

(h) Federal Income Taxes:

The fund intends to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the fund distributes substantially all of its net investment income and net realized capital gains, if any, to its shareholders each year. As long as the fund meets the tax requirements, it is not required to pay federal income tax.

(i) Indemnification:

Under the fund’s organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

(j) Regulatory Update:

Effective January 24, 2023, the SEC adopted rule and form amendments to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information deemed important for retail investors to assess and monitor their fund investments. Other information, including financial statements, will no longer appear in a streamlined shareholder report but must 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. At this time, management is evaluating the impact of these rule and form amendment changes on the content of the current shareholder report and the newly created annual and semiannual streamlined shareholder reports.

3. Risk Factors:

Investing in the fund may involve certain risks, as discussed in the fund’s prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Market Risk. Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics, may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money over short or long periods.

Investment Style Risk. The fund is an index fund. Therefore, the fund follows the securities included in the index during upturns as well as downturns. Because of its indexing strategy, the fund does not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of the fund’s expenses, the fund’s performance may be below that of the index. Errors relating to the index may occur from time to time and may not be identified by the index provider for a period of time. In addition, market disruptions could cause delays in the index’s rebalancing schedule. Such errors and/or market disruptions may result in losses for the fund.

Interest Rate Risk. Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, the fund’s yield will change over time. During periods when interest rates are low, the fund’s yield (and total return) also may be low. Changes in interest rates also may affect the fund’s share price: a rise in interest rates generally causes the fund’s share price to fall. The longer the fund’s portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank’s monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which the fund invests. A sudden or unpredictable rise in interest rates may cause volatility and the value of fixed-income securities to decline.

Credit Risk. A decline in the credit quality of an issuer, guarantor or liquidity provider of a portfolio investment or a counterparty could cause the fund to lose money or underperform. The fund could lose money if, due to a decline in credit quality, the issuer, guarantor or liquidity provider of a portfolio investment or a counterparty fails to make, or is perceived as being unable or unwilling to make, timely principal or interest payments or otherwise honor its obligations.

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Schwab High Yield Bond ETF

Financial Notes (continued)

3. Risk Factors (continued):

High-Yield Risk. High-yield securities and unrated securities of similar credit quality (junk bonds) are subject to greater levels of credit and liquidity risks, and may be more volatile than higher-rated securities. High-yield securities are considered predominately speculative with respect to the issuer’s continuing ability to make principal and interest payments.

Sampling Index Tracking Risk. The fund may not fully replicate the index and may hold securities not included in the index. As a result, the fund is subject to the risk that the investment adviser’s investment management strategy, the implementation of which is subject to a number of constraints, may not produce the intended results. Because the fund utilizes a sampling approach it may not track the return of the index as well as it would if the fund purchased all of the securities in the index.

Tracking Error Risk. As an index fund, the fund seeks to track the performance of the index, although it may not be successful in doing so. The divergence between the performance of the fund and the index, positive or negative, is called “tracking error.” Tracking error can be caused by many factors and it may be significant.

Non-U.S. Issuer Risk. The fund may invest in U.S.-registered, dollar-denominated bonds of non-U.S. corporations. The fund’s investments in bonds of non-U.S. issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with bonds issued by non-U.S. corporations and entities in emerging markets.

Privately Issued Securities Risk. Privately issued securities, including those purchased pursuant to Rule 144A under the Securities Act of 1933, as amended (the 1933 Act), are generally not traded on established markets. Privately issued securities carry the risk that the liquidity of these securities may become impaired, making it more difficult for the fund to sell these bonds. Delay or difficulty in selling such securities may result in a loss to the fund.

Portfolio Turnover Risk. The fund may engage in frequent trading of its portfolio securities in connection with its tracking of the index or in response to market conditions. A higher portfolio turnover rate may result in increased transaction costs, which may lower the fund’s performance. A higher portfolio turnover rate can also result in an increase in taxable capital gains distributions to the fund’s shareholders.

Prepayment and Extension Risk. Certain fixed-income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause the fund to forgo future interest income on the portion of the security’s principal repaid early and force the fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause the fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt the fund’s performance.

Derivatives Risk. The fund may invest in derivative instruments. The principal types of derivatives used by the fund are futures contracts. A futures contract is an agreement to buy or sell a financial instrument at a specific price on a specific day. The fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as market risk, credit risk and liquidity risk, are discussed elsewhere in this section. The fund’s use of derivatives is also subject to lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause the fund to realize higher amounts of short-term capital gains. The fund’s use of derivatives could reduce the fund’s performance, increase the fund’s volatility, and cause the fund to lose more than the initial amount invested. The fund’s use of derivatives also could create a risk of counterparty default under certain transactions, risks that the fund would need to liquidate portfolio positions when it may not be advantageous to do so in order to meet margin and payment obligations, and legal risks relating to insufficient documentation, insufficient capacity or authority of a counterparty, or legality or enforceability of a contract. Furthermore, the use of derivatives subject to regulation by the Commodity Futures Trading Commission (CFTC) could cause the fund to become a commodity pool, which would require the fund to comply with certain CFTC rules.

Liquidity Risk. The fund may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the fund may have to sell them at a loss.

Securities Lending Risk. Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.

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Schwab High Yield Bond ETF

Financial Notes (continued)

3. Risk Factors (continued):

Concentration Risk. To the extent that the fund’s or the index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, the fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.

Market Trading Risk. Although fund shares are listed on national securities exchanges, there can be no assurance that an active trading market for fund shares will develop or be maintained. If an active market is not maintained, investors may find it difficult to buy or sell fund shares.

Shares of the Fund May Trade at Prices Other Than NAV. Fund shares may be bought and sold in the secondary market at market prices. Although it is expected that the market price of the shares of the fund will approximate the fund’s net asset value (NAV), there may be times when the market price and the NAV vary significantly. An investor may pay more than NAV when buying shares of the fund in the secondary market, and an investor may receive less than NAV when selling those shares in the secondary market. The market price of fund shares may deviate, sometimes significantly, from NAV during periods of market volatility or market disruption.

Please refer to the fund’s prospectus for a more complete description of the principal risks of investing in the fund.

4. Affiliates and Affiliated Transactions:

Investment Adviser

Charles Schwab Investment Management, Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund’s investment adviser pursuant to the Advisory Agreement between the investment adviser and the trust.

For its advisory services to the fund, the investment adviser is entitled to receive an annual management fee, payable monthly, equal to 0.10% of the fund’s average daily net assets. Subsequent to the reporting period ended August 31, 2023 the management fee for the fund was reduced from 0.10% to 0.03% effective September 25, 2023.

Interfund Borrowing and Lending

Pursuant to an exemptive order issued by the SEC, the fund may enter into interfund borrowing and lending transactions with other funds in the Fund Complex. All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review of the Board. The fund had no interfund borrowing or lending activity during the period.

Shareholder Concentration

Certain accounts or CSIM affiliates may from time to time own (beneficially or of record) or control a significant percentage of a fund’s shares. Redemptions by these accounts of their holdings in a fund may impact the fund’s liquidity and NAV. These redemptions may also force the fund to sell securities, which may negatively impact the fund’s brokerage costs. Please refer to note 3 for more information on liquidity risk. As of August 31, 2023, one institution held 42% of the outstanding shares of the fund.

5. Other Service Providers:

SEI Investments Distribution Co. is the principal underwriter and distributor of shares of the fund.

State Street Bank and Trust Company (State Street) serves as the fund’s transfer agent. As part of these services, the transfer agent maintains records pertaining to the sale, redemption and transfer of the fund’s shares. The transfer agent is also responsible for the order-taking function for the fund’s shares.

State Street also serves as custodian and accountant for the fund. The custodian is responsible for the daily safekeeping of securities and cash held by the fund. The fund’s accountant maintains all books and records related to the fund’s transactions.

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Financial Notes (continued)

6. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The fund did not pay any interested trustees or non-interested trustees (independent trustees). The independent trustees are paid by the investment adviser. For information regarding the trustees, please refer to the Trustees and Officers table at the end of this report.

7. Borrowing from Banks:

During the period, the fund was a participant with other funds in the Fund Complex in a joint, syndicated, committed $1 billion line of credit (the Syndicated Credit Facility), maturing on September 28, 2023. Under the terms of the Syndicated Credit Facility, in addition to the investment adviser paying the interest charged on any borrowings by the fund, the investment adviser paid a commitment fee of 0.15% per annum on the fund’s proportionate share of the unused portion of the Syndicated Credit Facility.

During the period, the fund was a participant with other funds in the Fund Complex, in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street, maturing on September 28, 2023. Under the terms of the Uncommitted Credit Facility, the investment adviser pays interest on the amount the fund borrows. There were no borrowings by the fund from either line of credit during the period.

The fund also has access to custodian overdraft facilities. The fund may have utilized the overdraft facility and incurred an interest expense, which is paid by the investment adviser. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended August 31, 2023, purchases and sales/maturities of securities (excluding in-kind transactions and short-term obligations) were as follows:

PURCHASES OF SECURITIES	SALES/MATURITIES OF SECURITIES
$546,527	$813,876

9. In-Kind Transactions:

The consideration for the purchase of Creation Units of the fund often consists of the in-kind deposit of a designated portfolio of fixed-income securities, which constitutes an optimized representation of the securities involved in a relevant fund’s underlying index, and an amount of cash. Investors purchasing and redeeming Creation Units are subject to a standard creation transaction fee and a standard redemption transaction fee paid to the custodian to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units. Purchasers and redeemers of Creation Units for cash are subject to an additional variable charge paid to the fund that will offset the transaction costs to the fund of buying or selling portfolio securities. Variable charges paid to the fund generally have no effect on net asset value per share. In addition, purchasers and redeemers of shares in Creation Units are responsible for payment of the costs of transferring securities to or out of the fund. From time to time, the investment adviser may cover the cost of any transaction fees when believed to be in the best interests of the fund.

The in-kind transactions for the period ended August 31, 2023, were as follows:

IN-KIND PURCHASES OF SECURITIES	IN-KIND SALES OF SECURITIES
$44,052,143	$0

For the period ended August 31, 2023, the fund may realize net capital gains or losses resulting from in-kind redemptions of Creation Units. Because such gains or losses are not taxable to the fund and are not distributed to existing fund shareholders, the gains or losses are reclassified from accumulated net realized gains or losses to capital received from investors at the end of the fund’s tax year. These reclassifications have no effect on net assets or net asset value per share. The net realized gains or losses on sales of in-kind redemptions for the period ended August 31, 2023, are disclosed in the fund’s Statement of Operations, if any.

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Financial Notes (continued)

10. Federal Income Taxes:

As of August 31, 2023, the tax basis cost of the fund’s investments and gross unrealized appreciation and depreciation were as follows:

TAX COST	GROSS UNREALIZED APPRECIATION	GROSS UNREALIZED DEPRECIATION	NET UNREALIZED APPRECIATION (DEPRECIATION)
$44,792,716	$409,980	($227,494 )	$182,486

As of August 31, 2023, the components of distributable earnings on a tax basis were as follows:

UNDISTRIBUTED ORDINARY INCOME	NET UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS	CAPITAL LOSS CARRYFORWARDS AND OTHER LOSSES	TOTAL
$463,067	$182,486	($16,014 )	$629,539

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of August 31, 2023, the fund had capital loss carryforwards of $16,014.

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts in the financial statements. The fund may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes. There were no distributions paid during the period ended August 31, 2023.

Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments have no impact on net assets or the results of operations.

As of August 31, 2023, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund’s financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the fund’s Statement of Operations. During the period ended August 31, 2023, the fund did not incur any interest or penalties.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

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Schwab High Yield Bond ETF

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of Schwab Strategic Trust and Shareholders of Schwab High Yield Bond ETF:

Opinion on the Financial Statements and Financial Highlights

We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of Schwab High Yield Bond ETF, (the “Fund”) one of the funds constituting Schwab Strategic Trust, as of August 31, 2023, the related statement of operations, the statement of changes in net assets and the financial highlights for the period from July 11, 2023 (commencement of operations) through August 31, 2023, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of August 31, 2023, and the results of its operations, the changes in its net assets and the financial highlights for the period from July 11, 2023 (commencement of operations) through August 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements and financial highlights based on our audit. 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 audit 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 and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, 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 and financial highlights. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of August 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 audit provides a reasonable basis for our opinion.

Deloitte & Touche LLP
Denver, Colorado
October 17, 2023

We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.

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Investment Advisory Agreement Approval

Initial Approval of Investment Advisory Agreement

The Investment Company Act of 1940, as amended (the 1940 Act), requires that the approval of a fund’s investment advisory agreement must be specifically approved (1) by the vote of the trustees or by a vote of the shareholders of the fund, and (2) by the vote of a majority of the trustees who are not parties to the investment advisory agreements or “interested persons” of any party thereto (the Independent Trustees), cast in person at a meeting called for the purpose of voting on such approval. In connection with such approvals, the fund’s trustees must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the investment advisory agreement.

The Board of Trustees (the Board or the Trustees, as appropriate) called and held a meeting on December 14, 2022, in part, for the purpose of considering whether to appoint Charles Schwab Investment Management, Inc. (dba Schwab Asset Management) (the investment adviser), as investment adviser to the Schwab High Yield Bond ETF (the Fund) under the investment advisory agreement between Schwab Strategic Trust (the Trust) and the investment adviser (the Agreement). In preparation for the meeting, the Board requested and reviewed a wide variety of materials provided by the investment adviser and considered information that the Board receives from the investment adviser throughout the year, including information about the investment adviser’s affiliates, personnel, business goals and priorities, profitability, third-party oversight, corporate structure and operations. The Board also received data provided by an independent provider of investment company data. In recognition of the fact that the Fund had not yet commenced operations, the Board also considered information provided by the investment adviser in connection with the Board’s consideration of approval of the investment advisory agreement with respect to the other funds within the Trust. The Board also took into account the detailed information about other funds within the Trust that the Board reviews during the course of each year, including information that relates to those funds’ operations and performance, legal and compliance matters, risk management, portfolio turnover, and sales and marketing activity. The Independent Trustees received advice from Independent Trustees’ legal counsel, including with respect to the responsibilities of trustees for the approval of investment advisory agreements. In addition, the Independent Trustees participated in question and answer sessions with representatives of the investment adviser and met in executive session outside the presence of Fund management.

The Board, including a majority of the Independent Trustees approved the Agreement with respect to the Fund. In addition, the Board, including a majority of the Independent Trustees, considered information specifically relating to the continuance

of the Agreement with respect to the Fund at meetings held on April 27, 2023 and June 6, 2023, and approved the renewal of the Agreement with respect to the Fund for an additional one-year term at the meeting on June 6, 2023 called for the purpose of voting on such approval. The Board’s initial approval of the Agreement and the approval of the continuance of the Agreement was based on consideration and evaluation of a variety of specific factors discussed at these meetings, including:

the nature, extent and quality of the services to be provided to the Fund under the Agreement, including the resources of the investment adviser and its affiliates to be dedicated to the Fund;

the investment adviser’s investment performance in managing other index-based exchange-traded funds;

the Fund’s estimated expenses and how those expenses compared to those of certain other similar exchange-traded funds;

the expected profitability of the investment adviser and its affiliates, including Charles Schwab & Co., Inc. (Schwab), with respect to management of the Fund, including both direct and indirect benefits accruing to the investment adviser and its affiliates; and

the extent to which economies of scale would be realized as the Fund grows and whether fee levels in the Agreement reflect those economies of scale for the benefit of Fund investors.

Nature, Extent and Quality of Services. The Board considered the nature, extent and quality of the services to be provided by the investment adviser to the Fund and the resources that the investment adviser and its affiliates will dedicate to the Fund. In this regard, the Trustees evaluated, among other things, the investment adviser’s experience, track record, compliance program, resources dedicated to hiring and retaining skilled personnel and specialized talent, and information security resources. The Trustees also considered information provided by the investment adviser relating to services and support to be provided with respect to the Fund’s portfolio management team, portfolio strategy, and internal investment guidelines, as well as trading infrastructure, liquidity management, product design and analysis, shareholder communications, securities valuation, and vendor and risk oversight. The Trustees also considered investments the investment adviser has made in its infrastructure, including modernizing the investment adviser’s technology and use of data, increasing expertise in key areas (including portfolio management and trade operations), and improving business continuity, cybersecurity, due diligence, risk management processes, and information security programs, which are designed to provide enhanced services to the Fund and its shareholders. The Trustees also considered Schwab’s

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overall financial condition and reputation as a full service brokerage firm as well as the wide range of products, services, and account features that benefit Fund shareholders who are brokerage clients of Schwab. Following such evaluation, the Board concluded, within the context of its full deliberations, that the nature, extent and quality of services to be provided by the investment adviser to the Fund and the resources of the investment adviser and its affiliates dedicated to the Fund supported initial approval and renewal of the Agreement with respect to the Fund.

Fund Performance. Since the Fund had not commenced operations and therefore did not have any performance of its own, the Board considered the Fund’s expected index tracking error and the characteristics of the Fund’s proposed index relative to other market indices in determining whether to approve the Agreement. Following such evaluation, the Board concluded, within the context of its full deliberations, that the expected performance of the Fund supported initial approval and renewal of the Agreement with respect to the Fund.

Fund Expenses. With respect to the Fund’s expenses, the Trustees considered the proposed rate of compensation called for by the Agreement and the Fund’s estimated operating expense ratio, in each case, in comparison to those of other similar exchange-traded funds, such peer groups and comparisons having been selected and calculated by an independent provider of investment company data. The investment adviser reported to the Board, and the Board took into account, the risk assumed by the investment adviser in the development of the Fund and the services to be provided as well as the competitive marketplace for financial products. The Trustees also considered fees charged by the investment adviser to mutual funds and other exchange-traded funds that it manages. The Board evaluated the Fund’s unitary fee through review of comparative information with respect to fees paid by other similar exchange-traded funds tracking high yield bond indices. Following such evaluation, the Board concluded, within the context of its full deliberations, that the expenses of the Fund are reasonable and supported initial approval and renewal of the Agreement with respect to the Fund.

Profitability. With regard to profitability, the Trustees considered the expected compensation to be flowing to the investment adviser and its affiliates, directly or indirectly. In this connection, the Trustees reviewed management’s profitability analysis of the investment adviser relating to the Fund, noting the benefits to Fund shareholders of being part of the Schwab fund complex, including the allocations of certain fixed costs across the Fund and other funds in the complex. The Trustees considered any other potential benefits to be derived by the investment adviser from its relationship with the Fund, such as whether, by virtue of its management of the Fund, the investment adviser obtains investment information or other research resources that aid it in providing advisory

services to other clients. The Trustees considered whether the expected compensation and profitability with respect to the Fund under the Agreement and other service agreements were reasonable in light of the quality of all services to be rendered to the Fund by the investment adviser and its affiliates. The Trustees noted that the investment adviser continues to invest substantial sums in its business in order to provide enhanced research capabilities, services, and systems that would benefit the Fund. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the expected profitability of the investment adviser, albeit uncertain, is reasonable and supported initial approval and renewal of the Agreement with respect to the Fund.

Economies of Scale. Recognizing that the Fund had not yet commenced operations and had no assets, the Trustees considered the potential existence of any economies of scale and whether those could be expected to be passed along to the Fund’s shareholders by way of the relatively low advisory fee and unitary fee structure of the Fund through (i) the enhancement of services provided to the Fund in return for fees paid, including through investments by the investment adviser in the investment adviser’s infrastructure, including modernizing its technology and use of data, increasing expertise and capabilities in key areas (including portfolio and trade operations), and improving business continuity, cybersecurity, due diligence and information security programs, which are designed to provide enhanced services to the Fund and its shareholders; and (ii) pricing the Fund to scale and keeping overall expenses down as the Fund grows. The Trustees acknowledged that the investment adviser’s internal costs of providing investment management, technology, administrative, legal and compliance services to the Fund may increase as a result of regulatory or other developments. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the Fund may be expected to obtain reasonable benefits from economies of scale if such economies develop.

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

In the course of their deliberations, the Trustees may have accorded different weights to various factors and did not identify any particular information or factor that was all important or controlling. Based on the Trustees’ deliberation and their evaluation of the information described above, the Board, including all of the Independent Trustees, initially approved the Agreement and approved the continuance of the Agreement with respect to the Fund and concluded that the compensation under the Agreement with respect to the Fund is fair and reasonable in light of the services to be provided and the related expenses to be borne by the investment adviser and its affiliates and such other matters as the Trustees considered to be relevant in the exercise of their reasonable judgment.

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Schwab High Yield Bond ETF

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Strategic Trust, which includes the fund covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust. The Fund Complex includes 106 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the Statement of Additional Information, which is available free by calling 1-877-824-5615.

Independent Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served1)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Michael J. Beer 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2022)	Retired. Director, President and Chief Executive Officer (Dec. 2016 – Sept. 2019), Principal Funds (investment management).	106	Director (2016 – 2019), Principal Funds, Inc.
Robert W. Burns 1959 Trustee (Trustee of Schwab Strategic Trust since 2009; The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2016)	Retired/Private Investor.	106	None
Nancy F. Heller 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2018)	Retired.	106	None
David L. Mahoney 1954 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2011; Schwab Strategic Trust since 2016)	Private Investor.	106	Director (2004 – present), Corcept Therapeutics Incorporated Director (2009 – 2021), Adamas Pharmaceuticals, Inc. Director (2003 – 2019), Symantec Corporation
Jane P. Moncreiff 1961 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2019)	Consultant (2018 – present), Fulham Advisers LLC (management consulting); Chief Investment Officer (2009 – 2017), CareGroup Healthcare System, Inc. (healthcare).	106	None

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Interested Trustees
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served1)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Walter W. Bettinger II2 1960 Chairman and Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust and Schwab Annuity Portfolios since 2008; Schwab Strategic Trust since 2009; Laudus Trust since 2010)	Co-Chairman of the Board (July 2022 – present), Director and Chief Executive Officer (Oct. 2008 – present) and President (Feb. 2007 – Oct. 2021), The Charles Schwab Corporation; President and Chief Executive Officer (Oct. 2008 – Oct. 2021) and Director (May 2008 – Oct. 2021), Charles Schwab & Co., Inc.; Director (Apr. 2006 – present), Charles Schwab Bank, SSB; Director (Nov. 2017 – present), Charles Schwab Premier Bank, SSB; Director (July 2019 – present), Charles Schwab Trust Bank; Director (May 2008 – present), Chief Executive Officer (Aug. 2017 – present) and President (Aug. 2017 – Nov. 2021), Schwab Holdings, Inc.; Director (Oct. 2020 – present), TD Ameritrade Holding Corporation; Director (July 2016 – Oct. 2021), Charles Schwab Investment Management, Inc.	106	Director (2008 – present), The Charles Schwab Corporation
Richard A. Wurster2 1973 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2022)	President (Oct. 2021 – present) and Executive Vice President – Schwab Asset Management Solutions (Apr. 2019 – Oct. 2021), The Charles Schwab Corporation; President, Director (Oct. 2021 – present), Executive Vice President – Schwab Asset Management Solutions (July 2019 – Oct. 2021) and Senior Vice President – Advisory (May 2016 – July 2019), Charles Schwab & Co., Inc.; President (Nov. 2021 – present), Schwab Holdings, Inc.; Director (Oct. 2021 – present) and Chief Executive Officer (Nov. 2019 – Jan. 2022), Charles Schwab Investment Management, Inc.; Director, Chief Executive Officer and President (Mar. 2018 – Oct. 2022), Charles Schwab Investment Advisory, Inc.; Chief Executive Officer (July 2016 – Apr. 2018) and President (Mar. 2017 – Apr. 2018), ThomasPartners, Inc.; Chief Executive Officer (July 2016 – Apr. 2018), Windhaven Investment Management, Inc.	106	None

Officers of the Trust
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served3)	Principal Occupations During the Past Five Years
Omar Aguilar 1970 Chief Executive Officer and Chief Investment Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Chief Executive Officer (Jan. 2022 – present), Chief Investment Officer (Apr. 2011 – present) and Senior Vice President (Apr. 2011 – Dec. 2021), Charles Schwab Investment Management, Inc.; Director, Chief Executive Officer and President (Oct. 2022 – present), Charles Schwab Investment Advisory, Inc.; Chief Executive Officer (Sept. 2023 – present), Chief Investment Officer (June 2011 – present) and Vice President (June 2011 – Sept. 2023), Schwab Funds, Laudus Trust and Schwab ETFs.
Jonathan de St. Paer 1973 President (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2018)	Director (Apr. 2019 – present), President (Oct. 2018 – present), Chief Operating Officer (Jan. 2021 – present), and Chief Executive Officer (Apr. 2019 – Nov. 2019), Charles Schwab Investment Management, Inc.; Senior Vice President (June 2020 – Mar. 2022) and Chief Operating Officer (Jan. 2021 – Mar. 2022), Charles Schwab Investment Advisory, Inc.; President (Nov. 2018 – present), Chief Executive Officer (Apr. 2019 – Sept. 2023) and Trustee (Apr. 2019 – Dec. 2020), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director (May 2022 – present), Senior Vice President (Apr. 2019 – May 2022) and Senior Vice President – Strategy and Product Development (CSIM) (Jan. 2014 – Mar. 2019), Charles Schwab & Co., Inc.
Mark Fischer 1970 Chief Operating Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2013)	Chief Operating Officer (Dec. 2020 – present) and Treasurer and Chief Financial Officer (Jan. 2016 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director (Mar. 2023 – present), Chief Financial Officer (Mar. 2020 – present) and Vice President (Oct. 2013 – Mar. 2023), Charles Schwab Investment Management, Inc.

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Officers of the Trust (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served3)	Principal Occupations During the Past Five Years
Dana Smith 1965 Treasurer and Chief Financial Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2023)	Treasurer and Chief Financial Officer (Jan. 2023 – present) and Assistant Treasurer (Dec. 2015 – Dec. 2022), Schwab Funds, Laudus Trust and Schwab ETFs; Managing Director (Mar. 2023 – present), Vice President (Mar. 2022 – Mar. 2023) and Director (Oct. 2015 – Mar. 2022), Charles Schwab Investment Management, Inc.
Brett Wander 1961 Vice President and Chief Investment Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2011)	Managing Director (Mar. 2023 – present), Chief Investment Officer (Apr. 2011 – present) and Senior Vice President (Apr. 2011 – Mar. 2023) Charles Schwab Investment Management, Inc.; Vice President and Chief Investment Officer (June 2011 – present), Schwab Funds, Laudus Trust and Schwab ETFs.
William P. McMahon, Jr. 1972 Vice President and Chief Investment Officer (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2021)	Managing Director (Mar. 2023 – present), Chief Investment Officer (Jan. 2020 – present) and Senior Vice President (Jan. 2020 – Mar. 2023) Charles Schwab Investment Management, Inc.; Vice President and Chief Investment Officer (June 2021 – present), Schwab Funds, Laudus Trust and Schwab ETFs; Senior Vice President and Chief Investment Officer – ThomasPartners Strategies (Apr. 2018 – Dec. 2019), Charles Schwab Investment Advisory, Inc.; Senior Vice President and Chief Investment Officer (May 2001 – Apr. 2018), ThomasPartners, Inc.
Catherine MacGregor 1964 Chief Legal Officer and Secretary, Schwab Funds and Schwab ETFs Chief Legal Officer, Vice President and Clerk, Laudus Trust (Officer of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust since 2005; Schwab Strategic Trust since 2009)	Managing Director (Mar. 2023 – present), Chief Legal Officer (Mar. 2022 – present) and Vice President (Sept. 2005 – Mar. 2023), Charles Schwab Investment Management, Inc.; Managing Director (May 2022 – present) and Vice President (July 2005 – May 2022), Charles Schwab & Co., Inc.; Vice President (Dec. 2005 – present) and Chief Legal Officer and Clerk (Mar. 2007 – present), Laudus Trust; Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President (Nov. 2005 – Oct. 2021) and Assistant Secretary (June 2007 – Oct. 2021), Schwab Funds; Chief Legal Officer and Secretary (Oct. 2021 – present), Vice President and Assistant Secretary (Oct. 2009 – Oct. 2021), Schwab ETFs.

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The retirement policy requires that each independent trustee retire by December 31 of the year in which the Trustee turns 74 or the Trustee’s twentieth year of service as an independent trustee on any trust in the Fund Complex, whichever occurs first.

Mr. Bettinger and Mr. Wurster are Interested Trustees. Mr. Bettinger and Mr. Wurster are Interested Trustees because each owns stock of The Charles Schwab Corporation (CSC), the parent company of Charles Schwab Investment Management, Inc., the investment adviser for the trusts in the Fund Complex, and is an employee of Charles Schwab & Co., Inc. (Schwab), the principal underwriter for The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Laudus Trust.

The President, Treasurer and Secretary/Clerk hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

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Glossary

ask See “offer.”

asset allocation The practice of dividing a portfolio among different asset classes, with each asset class assigned a particular percentage to help offset risks and rewards, based on your goals, time horizon and risk tolerance.

asset-backed securities Bond or other debt securities that represent ownership in a pool of assets such as credit card debt.

asset class A group of securities with similar structure and basic characteristics. Stocks, bonds and cash are the three main examples of asset classes.

authorized participant (AP) A large institutional investor that places orders for creation units with the funds’ distributor.

bid The highest price at which someone is willing to buy a security.

bond A security representing a loan from the investor to the issuer. A bond typically pays interest at a fixed rate (the “coupon rate”) until a specified date (the “maturity date”), at which time the issuer returns the money borrowed (“principal” or “face value”) to the bondholder. Because of their structure, bonds are sometimes called “fixed income securities” or “debt securities.”

call An early repayment of a bond’s principal by the issuer, usually done because the issuer is able to refinance its bond debt at a lower rate.

call protection A term used in reference to a bond that cannot be called by the issuer before maturity, or at least for many years from the present date. A bond that offers call protection can more reliably be expected to provide a given yield over a given number of years than a bond that could be called (assuming both bonds are of the same credit quality).

capital gain, capital loss The difference between the amount paid for an investment and its value at a later time. If the investment has been sold, the capital gain or loss is considered a realized gain or loss. If the investment is still held, the gain or loss is still “on paper” and is considered unrealized.

commencement of operations The date that the first NAV was calculated.

coupon, coupon rate The annual rate of interest paid until maturity by the issuer of a debt security.

creation unit (C.U.) A basket of securities that is delivered by an authorized participant (AP) to the fund equal to the current holdings of the ETF, plus a designated cash component. In return, the APs receive a large block of ETF shares (typically 50,000 shares), which investors can then buy and sell in the secondary market.

credit quality The capacity of an issuer to make its interest and principal payments; an assessment typically rendered by an independent third-party organization.

credit risk The risk that a bond issuer may be unable to pay interest or principal to its bondholders.

duration A measure of an individual bond’s sensitivity to interest rates, expressed in years. Calculations of duration generally take into account the bond’s yield, interest payments, maturity date and call features.

weighted average duration A measure of the duration of all bonds in a fund’s portfolio, also expressed in years, based on the market value weighted average duration of each bond in the portfolio.

exchange A marketplace, or any organization or group that provides or maintains a marketplace for trading securities, options, futures, or commodities.

expense ratio The amount that is taken from the fund’s assets each year to cover the operating expenses. An expense ratio of 0.50% means that a fund’s expenses amount to half of one percent of its average net assets a year.

face value The value of a bond, note, mortgage or other security as given on the certificate or instrument. Face value is also referred to as par value or nominal value.

ICE BofA US Cash Pay High Yield Constrained Index An index that contains all securities in the ICE BofA US Cash Pay High Yield Index but caps issuer exposure at 2%. Index constituents are capitalization-weighted, based on their current amount outstanding, provided the total allocation to an individual issuer does not exceed 2%. Issuers that exceed the limit are reduced to 2% and the face value of each of their bonds is adjusted on a pro-rata basis. Similarly, the face values of bonds of all other issuers that fall below the 2% cap are increased on a pro-rata basis. In the event there are fewer than 50 issuers in the Index, each is equally weighted and the face values of their respective bonds are increased or decreased on a prorate basis.

inception date The date that the shares began trading in the secondary market.

indicative optimized portfolio value (IOPV) A calculation disseminated by the stock exchange that approximates the fund’s NAV every 15 seconds throughout the trading day.

interest Payments to bondholders (usually made twice a year) as compensation for loaning the bond principal to the issuer.

interest rate risk The risk that a bond’s value will fluctuate if market interest rates change or are expected to change. Bond prices tend to move in the opposite direction of interest rates: when interest rates rise, bond prices tend to fall.

liquidity The ability to convert a security or asset quickly into cash.

market price return The return based on the change in market price per share of the fund over a given time period. Market price returns assume that dividends and capital gain distributions have been reinvested in the fund at market price.

maturity The maturity of a bond will generally be determined using a portfolio security’s final maturity date (date on which the final principal payment of a bond is scheduled to be paid); however, for securitized products, such as mortgage-backed securities and certain other asset-backed securities, maturity will be determined on an average life basis (weighted average time to receipt of all principal payments) by the investment adviser. Because pre-payment rates of individual mortgage pools vary widely, the average life of a particular pool cannot be predicted precisely. For securities with embedded demand features,

Schwab High Yield Bond ETF | Annual Report43

Schwab High Yield Bond ETF

such as puts or calls, either the demand date or the final maturity date will be used depending on interest rates, yields and other market conditions. The weighted average maturity (WAM) of a fund is dollar-weighted based upon the market value of a fund’s securities at the time of the calculation.

mortgage-backed securities Bond or other debt securities that represent ownership in a pool of mortgage loans.

net asset value (NAV) The value of one share of a fund. NAV is calculated by taking the fund’s total assets, subtracting liabilities, and dividing by the number of shares outstanding.

NAV return The return based on the change in NAV of the fund over a given time period. NAV returns assume that dividends and capital gain distributions have been reinvested in the fund.

offer (ask) The lowest price at which an individual is willing to sell a security.

open The price at which a security opened for trading on a given day.

outstanding shares, shares outstanding When speaking of the fund, indicates all shares currently held by investors.

prepayment risk The risk that a mortgage-backed security may be paid off early, typically because interest rates have fallen and the homeowners who hold the underlying mortgages have refinanced those mortgages at lower rates. In this type of situation, the investor who held the mortgage-backed security will usually have to settle for a lower rate when reinvesting the principal.

primary market The market that deals with the issuance of new securities.

replication If a fund uses a full replication method, the fund will invest substantially all of its assets proportionately in the securities included in the underlying index.

sampling If a fund uses a sampling method, the fund will not fully replicate the underlying index and may hold securities not included in the index. A fund that utilizes a sampling approach may not track the return of the index as closely as a fund that uses a full replication method.

secondary market The market in which investors purchase securities from other investors rather than directly from the issuing companies. Organized exchanges facilitate the trading of securities in the secondary market.

spread The gap between bid and ask prices of a security.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

tracking error The difference between the performance of the fund and its benchmark index, positive or negative.

weighted average For mutual funds or ETFs, an average that gives the same weight to each security as the security represents in the fund’s portfolio.

yield The income paid out by an investment, expressed as a percentage of the investment’s market value.

yield to maturity The annualized rate of return a bondholder could expect if the bond were held to maturity. In addition to interest payments, yield to maturity also factors in any difference between a bond’s current price and its principal amount, or face value.

44Schwab High Yield Bond ETF | Annual Report

Schwab High Yield Bond ETF

Schwab ETFs

Schwab ETFs are designed to serve as simple low-cost core investment products for a diversified portfolio. These ETFs seek to provide consistent, repeatable performance through a variety of investment strategies that span the equity and fixed income spectrum. The list below shows all currently available Schwab ETFs.

Investors should carefully consider information contained in the prospectus, or if available, the summary prospectus, including investment objectives, risks, charges and expenses before investing. Please call 1-877-824-5615 for a prospectus for any Schwab ETF. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Schwab ETFs’ website at www.schwabassetmanagement.com/schwabetfs_prospectus, the SEC’s website at www.sec.gov, or by contacting Schwab ETFs at 1-877-824-5615.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabassetmanagement.com/schwabetfs_prospectus or the SEC’s website at www.sec.gov.

Schwab ETFs

U.S. ETFs

Schwab U.S. Broad Market ETF

Schwab 1000 Index® ETF

Schwab U.S. Large-Cap ETF

Schwab U.S. Large-Cap Growth ETF

Schwab U.S. Large-Cap Value ETF

Schwab U.S. Mid-Cap ETF

Schwab U.S. Small-Cap ETF

Schwab U.S. Dividend Equity ETF

Schwab U.S. REIT ETF

International ETFs

Schwab International Dividend Equity ETF

Schwab International Equity ETF

Schwab International Small-Cap Equity ETF

Schwab Emerging Markets Equity ETF

Fixed-Income ETFs

Schwab U.S. TIPS ETF

Schwab Short-Term U.S. Treasury ETF

Schwab Intermediate-Term U.S. Treasury ETF

Schwab Long-Term U.S. Treasury ETF

Schwab U.S. Aggregate Bond ETF

Schwab 1-5 Year Corporate Bond ETF

Schwab 5-10 Year Corporate Bond ETF

Schwab Municipal Bond ETF

Schwab High Yield Bond ETF

Fundamental Index* ETFs

Schwab Fundamental U.S. Broad Market Index ETF

Schwab Fundamental U.S. Large Company Index ETF

Schwab Fundamental U.S. Small Company Index ETF

Schwab Fundamental International Large Company Index ETF

Schwab Fundamental International Small Company Index ETF

Schwab Fundamental Emerging Markets Large Company
Index ETF

Active, Semi-Transparent (Also Known As Non-Transparent) ETF

Schwab Ariel ESG ETF

Thematic ETFs

Schwab Crypto Thematic ETF

Investment Adviser

Charles Schwab Investment Management, Inc., dba Schwab Asset Management

211 Main Street, San Francisco, CA 94105

Schwab ETFs

1-877-824-5615

FUNDAMENTAL INDEX is a registered trademark of Research Affiliates LLC.

The Schwab Ariel ESG ETF is different from traditional ETFs. Traditional ETFs tell the public what assets they hold each day. This fund will not. This may create additional risks for your investment. For example:

•

You may have to pay more money to trade the fund’s shares. This fund will provide less information to traders, who tend to charge more for trades when they have less information.

•

The price you pay to buy fund shares on an exchange may not match the value of the fund’s portfolio. The same is true when you sell shares. These price differences may be greater for this fund compared to other ETFs because it provides less information to traders.

•

These additional risks may be even greater in bad or uncertain market conditions.

•

The ETF will publish on its website each day a “Proxy Portfolio” designed to help trading in shares of the ETF. While the Proxy Portfolio includes some of the ETF’s holdings, it is not the ETF’s actual portfolio.

The differences between this fund and other ETFs may also have advantages. By keeping certain information about the fund secret, this fund may face less risk that other traders can predict or copy its investment strategy. This may improve the fund’s performance. If other traders are able to copy or predict the fund’s investment strategy, however, this may hurt the fund’s performance.

For additional information regarding the unique attributes and risks of the fund, see Proxy Portfolio Risk, Premium/Discount Risk, Trading Halt Risk, Authorized Participant Concentration Risk, Tracking Error Risk and Shares of the Fund May Trade at Prices Other Than NAV in the Principal Risks and Proxy Portfolio and Proxy Overlap sections of the prospectus and/or the Statement of Additional Information. These risks are discussed on the next page.

Schwab High Yield Bond ETF

Active semi-transparent (also referred to as non-transparent) ETFs operate differently from other exchange-traded funds (ETFs). Unlike other ETFs, an active semi-transparent ETF does not publicly disclose its entire portfolio composition each business day, which may affect the price at which shares of the ETF trade in the secondary market. Active semi-transparent ETFs have limited public trading history. There can be no assurance that an active trading market will develop, be maintained or operate as intended. There is a risk that the market price of an active semi-transparent ETF may vary significantly from the ETF’s net asset value and that its shares may trade at a wider bid/ask spread and, therefore, cost investors more to trade than shares of other ETFs. These risks are heightened during periods of market disruption or volatility.

Proxy Portfolio Risk: Unlike traditional ETFs, this fund does not disclose its portfolio holdings (Actual Portfolio) daily. The fund instead posts a Proxy Portfolio on its website each day. The Proxy Portfolio is designed to reflect the economic exposures and risk characteristics of the fund’s actual holdings on each trading day, but it is not the same as the fund’s Actual Portfolio. Although the Proxy Portfolio is intended to provide investors with enough information to allow for an effective arbitrage mechanism that will keep the market price of the Fund at or close to the underlying NAV per Share of the Fund, there is a risk (which may increase during periods of market disruption or volatility) that market prices will vary significantly from the underlying NAV of the fund. ETF trading on the basis of a published Proxy Portfolio may trade at a wider bid/ask spread than ETFs that publish their portfolios on a daily basis, especially during periods of market disruption or volatility, and therefore may cost investors more to trade. Also, while the Fund seeks to benefit from keeping its portfolio information secret, market participants may attempt to use the Proxy Portfolio to identify a Fund’s trading strategy, which if successful, could result in such market participants engaging in certain predatory trading practices that may have the potential to harm the Fund and its shareholders.

Proxy Portfolio Construction: The Proxy Portfolio is designed to recreate the daily performance of the Actual Portfolio. This is achieved by performing a “Factor Model” analysis of the Actual Portfolio. The Factor Model is comprised of three sets of factors or analytical metrics: market-based factors, fundamental factors, and industry/sector factors. The fund uses a “Model Universe” to generate its Proxy Portfolio. The Model Universe is comprised of securities that the fund can purchase and will be a financial index or stated portfolio of securities from which fund investments will be selected. The results of the Factor Model analysis are then applied to the Model Universe. The Proxy Portfolio is then generated as a result of this Model Universe analysis with the Proxy Portfolio being a small sub-set of the Model Universe. The Factor Model is applied to both the Actual Portfolio and the Model Universe to construct the fund’s Proxy Portfolio that performs in a manner substantially identical to the performance of its Actual Portfolio. The Proxy Portfolio will only include investments the fund is permitted to hold. The fund’s SAI contains more information on the Proxy Portfolio and its construction.

Proxy Portfolio and Proxy Overlap Information regarding the contents of the Proxy Portfolio, and the percentage weight overlap between the holdings of the Proxy Portfolio and the fund’s Actual Portfolio holdings that formed the basis for its calculation of NAV at the end of the prior Business Day (the Portfolio Overlap), is available by visiting the fund’s website www.schwabassetmanagement.com.

Because environmental, social and governance (ESG) strategies exclude some securities, ESG-focused products may not be able to take advantage of the same opportunities or market trends as products that do not use such strategies. Additionally, the criteria used to select companies for investment may result in investing in securities, industries or sectors that underperform the market as a whole.

	7/11/231– 8/31/23
Per-Share Data
Net asset value at beginning of period	$50.00
Income (loss) from investment operations:
Net investment income (loss)2	0.56
Net realized and unrealized gains (losses)	0.46
Total from investment operations	1.02
Net asset value at end of period	$51.02
Total return	2.04 %3
Ratios/Supplemental Data
Ratios to average net assets:
Total expenses	0.10 %4
Net investment income (loss)	7.88 %4
Portfolio turnover rate5	1 %3
Net assets, end of period (x 1,000)	$45,918

1	Commencement of operations.
2	Calculated based on the average shares outstanding during the period.
3	Not annualized.
4	Annualized.
5	Portfolio turnover rate excludes securities received or delivered from processing of in-kind creations or redemptions.

DESCRIPTION	QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1)	OTHER SIGNIFICANT OBSERVABLE INPUTS (LEVEL 2)	SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)	TOTAL
Assets
Corporates1	$—	$44,040,281	$—	$44,040,281
Short-Term Investments1	934,921	—	—	934,921
Total	$934,921	$44,040,281	$—	$44,975,202

Assets
Investments in securities, at value - unaffiliated (cost $44,792,716)		$44,975,202
Receivables:
Interest		760,386
Investments sold		183,959
Dividends	+	2,029
Total assets		45,921,576

Liabilities
Payables:
Management fees	+	3,823
Total liabilities		3,823
Net assets		$45,917,753

Net Assets by Source
Capital received from investors		$45,288,214
Total distributable earnings	+	629,539
Net assets		$45,917,753

Net Asset Value (NAV)
Net Assets	÷	Shares Outstanding	=	NAV
$45,917,753		900,000		$51.02

For the period July 11, 2023* through August 31, 2023
Investment Income
Interest received from securities - unaffiliated		$465,767
Dividends received from securities - unaffiliated	+	3,179
Total investment income		468,946

Expenses
Management fees		5,879
Total expenses	–	5,879
Net investment income		463,067

REALIZED AND UNREALIZED GAINS (LOSSES)
Net realized losses on sales of securities - unaffiliated		(16,014 )
Net change in unrealized appreciation (depreciation) on securities - unaffiliated	+	182,486
Net realized and unrealized gains		166,472
Increase in net assets resulting from operations		$629,539

OPERATIONS
	7/11/23*-8/31/23
Net investment income		$463,067
Net realized losses		(16,014 )
Net change in unrealized appreciation (depreciation)	+	182,486
Increase in net assets resulting from operations		$629,539

TRANSACTIONS IN FUND SHARES
	7/11/23*-8/31/23
		SHARES	VALUE
Shares sold		900,000	$45,288,214
Net transactions in fund shares		900,000	$45,288,214

SHARES OUTSTANDING AND NET ASSETS
	7/11/23*-8/31/23
		SHARES	NET ASSETS
Beginning of period		—	$—
Total increase	+	900,000	45,917,753
End of period		900,000	$45,917,753

Independent Trustees (continued)
Name, Year of Birth, and Position(s) with the trust (Terms of office, and length of Time Served1)	Principal Occupations During the Past Five Years	Number of Portfolios in Fund Complex Overseen by the Trustee	Other Directorships
Kimberly S. Patmore 1956 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2016)	Consultant (2008 – present), Patmore Management Consulting (management consulting).	106	None
J. Derek Penn 1957 Trustee (Trustee of The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust since 2021)	Head of Equity Sales and Trading (2006 – 2018), BNY Mellon (financial services).	106	None