SCHWAB STRATEGIC TRUST (0001454889) (Filer)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSRS

CERTIFIED SHAREHOLDER REPORT OF

REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-22311

Schwab Strategic Trust – Schwab U.S. REIT ETF

and Schwab Fundamental Index ETFs

(Exact name of registrant as specified in charter)

425 Market Street, Suite 1700, San Francisco, California 94105

(Address of principal executive offices) (Zip code)

Omar Aguilar

Schwab Strategic Trust – Schwab U.S. REIT ETF and Schwab Fundamental Index ETFs

425 Market Street, Suite 1700, San Francisco, California 94105

(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 648-5300

Date of fiscal year end: February 28

Date of reporting period: August 31, 2026

Item 1: Report(s) to Shareholders.

Semiannual Report |

August 31, 2026

Schwab U.S. REIT ETF

Ticker Symbol: SCHH

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — Dow Jones

®

is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones). The Dow Jones Equity All REIT Capped Index (the Index) is a

product of S&P Dow Jones Indices LLC, and the trademark and Index have been licensed for use by Charles Schwab Investment Management, Inc. The Schwab U.S. REIT ETF

is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, or any of their respective affiliates and neither S&P Dow Jones Indices LLC, Dow

Jones, nor any of their respective affiliates make any representation regarding the advisability of investing in such product.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The S&P 500

®

Index serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are included in

the Dow Jones Equity All REIT Capped Index. The fund does not seek to track the regulatory index.

4

The inception date of the Dow Jones Equity All REIT Capped Index is April 13, 2020. The fund began tracking the index on June 22, 2020.

Schwab U.S. REIT ETF | Semiannual Report

1

REG125436-02  00327870

Statistics

Industry Weightings % of Investments1

Top Equity Holdings % of Net Assets

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

Includes the fund’s position(s) in money market mutual funds registered under the Investment

Company

Act of 1940, as amended.

2

Schwab U.S. REIT ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab U.S. REIT ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental U.S. Broad Market ETF

Ticker Symbol: FNDB

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity US All Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and has been licensed

for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The Schwab Fundamental

U.S. Broad Market ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The RAFI Parties: (i) make no

representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence or otherwise) to any

person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The Russell 3000

®

Index serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are

included in the RAFI Fundamental High Liquidity US All Index. The fund does not seek to track the regulatory index.

4

The inception date of the RAFI Fundamental High Liquidity US All Index is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental U.S. Broad Market ETF | Semiannual Report

1

REG125417-02  00327867

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

3

Amount is less than 0.05%.

2

Schwab Fundamental U.S. Broad Market ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, fin

an

cial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental U.S. Broad Market ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental U.S. Large Company ETF

Ticker Symbol: FNDX

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity US Large Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and has been

licensed for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The Schwab

Fundamental U.S. Large Company ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The RAFI Parties: (i)

make no representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence or otherwise) to

any person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The Russell 1000

®

Index serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are

included in the RAFI Fundamental High Liquidity US Large Index. The fund does not seek to track the regulatory index.

4

The inception date of the RAFI Fundamental High Liquidity US Large Index is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental U.S. Large Company ETF | Semiannual Report

1

REG125418-02  00327868

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

2

Schwab Fundamental U.S. Large Company ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental U.S. Large Company ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental U.S. Small Company ETF

Ticker Symbol:

FNDA

Principal U.S. Listing Exchange:

NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity US Small Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and has been

licensed for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The Schwab

Fundamental U.S. Small Company ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The RAFI

Parties: (i) make no representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence or

otherwise) to any person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The S&P 500

®

Index serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are included in

the RAFI Fundamental High Liquidity US Small Index. The fund does not seek to track the regulatory index.

4

The inception date of the RAFI Fundamental High Liquidity US Small Index is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental U.S. Small Company ETF | Semiannual Report

1

REG125419-02  00327869

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

2

Schwab Fundamental U.S. Small Company ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental U.S. Small Company ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental International Equity ETF

Ticker Symbol: FNDF

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity Developed ex US Large Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and

has been licensed for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The

Schwab Fundamental International Equity ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The RAFI

Parties: (i) make no representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence or

otherwise) to any person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations.

4

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

5

The MSCI EAFE

®

Index (Net) serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are

included in the RAFI Fundamental High Liquidity Developed ex US Large Index (Net). The fund does not seek to track the regulatory index.

6

The inception date of the RAFI Fundamental High Liquidity Developed ex US Large Index (Net) is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental International Equity ETF | Semiannual Report

1

REG125415-02  00327865

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Country Weightings % of Investments

1

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS)

which

was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

2

Schwab Fundamental International Equity ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental International Equity ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental International Small Equity ETF

Ticker Symbol: FNDC

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026. You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.  

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity Developed ex US Small Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and

has been licensed for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The

Schwab Fundamental International Small Equity ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The

RAFI Parties: (i) make no representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence

or otherwise) to any person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations.

4

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

5

The MSCI EAFE

®

Index (Net) serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities that are

included in the RAFI Fundamental High Liquidity Developed ex US Small Index (Net). The fund does not seek to track the regulatory index.

6

The inception date of the RAFI Fundamental High Liquidity Developed ex US Small Index (Net) is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental International Small Equity ETF | Semiannual Report

1

REG125416-02  00327866

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Country Weightings % of Investments

1

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

2

Schwab Fundamental International Small Equity ETF | Semiannual

R

eport

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental International Small Equity ETF | Semiannual Report

3

Semiannual Report |

August 31, 2026

Schwab Fundamental Emerging Markets Equity ETF

Ticker Symbol: FNDE

Principal U.S. Listing Exchange: NYSE Arca, Inc.

This semiannual shareholder report contains important information about the fund for the period of March 1, 2026, to August 31, 2026.

You can find additional information about the fund at www.schwabassetmanagement.com/prospectus. You can also request this information by calling 1-866-414-6349 or by sending an email request to [email protected]. If you purchase

or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to

shareholders and other information about the fund are available from your financial intermediary.

FUND COSTS FOR THE LAST six months ENDED August 31, 2026 (BASED ON A HYPOTHETICAL $10,000 INVESTMENT)

*

Annualized.  

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/prospectus.

Average Annual Total Returns

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 www.schwabassetmanagement.com/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.

Index ownership — The RAFI Fundamental High Liquidity Emerging Markets Index (the Index) is a service mark of RAFI Indices, LLC or its affiliates (collectively, RAFI) and has

been licensed for use by Charles Schwab Investment Management, Inc. The intellectual and other property rights to the Index are owned by or licensed to RAFI. The Schwab

Fundamental Emerging Markets Equity ETF is not sponsored, endorsed, sold or promoted by RAFI, its agents or service providers (collectively, the RAFI Parties). The RAFI

Parties: (i) make no representation or warranty as to the results to be obtained from the use of the Index or otherwise; and (ii) shall not be liable (whether in negligence or

otherwise) to any person for any error in the Index. For full disclaimer, please see the fund’s statement of additional information.

1

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.

2

Performance is shown on 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. Returns assume that dividends and capital gain distributions have been

reinvested in the fund at NAV.

3

The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations.

4

The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes.

5

The MSCI Emerging Markets Index (Net) serves as the fund’s regulatory index and provides a broad measure of market performance. The fund generally invests in securities

that are included in the RAFI Fundamental High Liquidity Emerging Markets Index (Net). The fund does not seek to track the regulatory index.

6

The inception date of the RAFI Fundamental High Liquidity Emerging Markets Index (Net) is January 31, 2024. The fund began tracking the index on June 21, 2024.

Schwab Fundamental Emerging Markets Equity ETF | Semiannual Report

1

REG125414-02  00327864

Statistics

Sector Weightings % of Investments1

Top Equity Holdings % of Net Assets

Country Weightings % of Investments

1

Portfolio holdings may have changed since the report date.

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc.

(MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.

1

Excludes derivatives.

2

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

amended

.

2

Schwab Fundamental Emerging Markets Equity ETF | Semiannual Report

AVAILABILITY OF ADDITIONAL INFORMATION

You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,

holdings, certain tax information, proxy voting information, and other information about the fund online at

www.schwabassetmanagement.com/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/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/prospectus

or the

SEC’s website at

www.sec.gov

, by calling

1-866-414-6349

, or by sending an email request to

[email protected]

.

Schwab Fundamental Emerging Markets Equity ETF | Semiannual Report

3

Item 2: Code of Ethics.

Not applicable to this semi-annual report.

Item 3: Audit Committee Financial Expert.

Not applicable to this semi-annual report.

Item 4: Principal Accountant Fees and Services.

Not applicable to this semi-annual report.

Item 5: Audit Committee of Listed Registrants.

Not applicable to this semi-annual report.

Item 6: Schedule of Investments.

The schedules of investments are included under Item 7 of this Form.

Item 7: Financial Statements and Financial Highlights for Open-End Management Investment Companies.

Semiannual Holdings and Financial Statements | August 31, 2026

Schwab U.S. REIT ETF

    Ticker Symbol SCHH

In This Report

Fund investment adviser: Charles Schwab Investment Management, Inc., dba Schwab Asset Management®

Distributor: SEI Investments Distribution Co. (SIDCO)

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc. (MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the Portfolio Holdings are sub-categories of Sector classifications. 

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

1

Schwab U.S. REIT ETF

Financial Statements

FINANCIAL HIGHLIGHTS

See financial notes

2

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Portfolio Holdings  as of August 31, 2026 (Unaudited)

See financial notes

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

3

Schwab U.S. REIT ETF

Portfolio Holdings  as of August 31, 2026 (Unaudited) (continued)

Below is a summary of the fund’s transactions with affiliated issuers and companies which are or were affiliates during the period ended August 31, 2026. An affiliated company is a company in which the investment adviser has or had an ownership of at least 5% of the voting securities of a security issue during the report period. A dash in the Value at February 28, 2026, and/or Value and Balance of Shares Held at August 31, 2026, columns means either the issuer was not held or not held as an affiliate on the stated date. 

See financial notes

4

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Portfolio Holdings  as of August 31, 2026 (Unaudited) (continued)

The following is a summary of the inputs used to value the fund’s investments as of August 31, 2026: 

See financial notes

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

5

Schwab U.S. REIT ETF

Statement of Assets and Liabilities

As of August 31, 2026; unaudited 

See financial notes

6

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Statement of Operations

See financial notes

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

7

Schwab U.S. REIT ETF

Statement of Changes in Net Assets

For the current and prior report periods

Figures for the current period are unaudited 

See financial notes

8

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Financial Notes, unaudited

1. Business Structure of the Fund:

The fund in this report 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 fund issues and redeems shares at its net asset value per share 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 net asset value, shares may trade at a price greater than net asset value (premium) or less than net asset value (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 net asset value can be found at www.schwabassetmanagement.com.

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 "Schwab Funds Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust.

Investment Objective  

The Schwab U.S. REIT ETF’s goal is to track as closely as possible, before fees and expenses, the total return of an index composed of U.S. real estate investment trusts classified as equities.

  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 (ASC) 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 mutual funds and exchange-traded 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 and holdings and financial statements, which are filed in Form N-CSR with the U.S. Securities and Exchange Commission (SEC) and 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 has designated authority to a Valuation Designee, the fund’s investment adviser, to make fair valuation determinations under adopted procedures, subject to Board of Trustees 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.

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:

● Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes.

● Futures contracts: Futures contracts are valued at their settlement prices as of the close of their exchanges.

● Mutual funds: Mutual funds are valued at their respective net asset values.

● 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

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

9

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued): 

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 the 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 and futures contracts. Mutual funds and exchange-traded funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held which could be Level 1, Level 2, or Level 3 in the fair value hierarchy.

● 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 forward foreign currency exchange contracts, 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 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 the 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 are disclosed in the fund’s Portfolio Holdings.

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

Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. The fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into a futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by the fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized appreciation or depreciation until the contract is closed, at which time the gains or losses are realized. Futures contracts are traded publicly on exchanges, and their value may change daily.

Securities Lending: Under the trust’s Securities Lending Program, the fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the

10

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued): 

individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides the fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. The fund bears the risk of loss with respect to the investment of cash collateral. The terms of the securities lending agreement allow the fund or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in the fund’s Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between the fund and the lending agent. The aggregate market value of securities loaned will not at any time exceed one-third of the total assets of the fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agent start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.

As of August 31, 2026, the fund had securities on loan, all of which were classified as common stocks. The value of securities on loan and the related collateral as of August 31, 2026, are disclosed in the fund’s Portfolio Holdings and Statement of Assets and Liabilities.

(c) Security Transactions:

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.

When the fund closes out a futures contract position, it calculates the difference between the value of the position at the beginning and at the end of the contract, and records a realized gain or loss accordingly.

The fund invests in real estate investment trusts (REITs) which report information on the source of their distributions annually. The fund’s policy is to record all REIT distributions initially as dividend income on the ex-dividend date and then re-designate them as return of capital and/or capital gain distributions at the end of the reporting period based on information provided annually by each REIT, and management estimates such re-designations when actual information has not yet been reported.

(d) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are recorded on the date they are effective (the ex-dividend date). Non-cash dividends in the form of additional securities are recorded on the ex-dividend date at fair value, if any. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

(e) Expenses:

Pursuant to the Amended and Restated Advisory Agreement between the investment adviser and the trust, the investment adviser pays the operating expenses of the fund, excluding acquired fund fees and expenses, 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. Acquired fund fees and expenses are indirect expenses incurred by a fund through its investments in underlying funds and are reflected in the net asset values of the underlying funds.

(f) Distributions to Shareholders:

The fund makes distributions from net investment income, if any, quarterly 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.

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

11

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued): 

(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.

(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. The fund did not pay any federal taxes during the period.

(i) Segment Reporting:

An operating segment is defined in ASC Topic 280 Segment Reporting as a component of a public entity that engages in business activities from which it may recognize revenues and incur expenses, has operating results that are regularly reviewed by the public entity’s chief operating decision maker (CODM) to make decisions about resources to be allocated to the segment and assess its performance, and has discrete financial information available.

The management committee of the fund’s investment adviser acts as the fund’s CODM. The CODM has determined that the fund operates as a single operating segment given the fund has a single defined investment strategy disclosed in its respective prospectus. The discrete financial information in the form of the fund’s portfolio composition, total returns, expense ratios and changes in net assets (i.e., changes in net assets resulting from operations, shares sold and shares redeemed), which is used by the CODM to assess performance against the prospectus and to make resource allocation decisions with respect to the fund, is presented within the fund’s financial statements.

(j) 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.

  3. 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 Amended and Restated 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 fee, payable monthly, equal to 0.07% of the fund’s average daily net assets.

12

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

3. Affiliates and Affiliated Transactions (continued): 

Investments from Affiliates

Funds in the Schwab Funds Complex may own shares of other funds in the Schwab Funds Complex. The table below reflects the percentage of shares of the fund in this report that is owned by other funds in the Schwab Funds Complex as of August 31, 2026, as applicable: 

Interfund Transactions

The fund may engage in direct transactions with other funds in the Schwab Funds Complex in accordance with procedures adopted by the Board of Trustees pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another fund is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs while allowing each fund to execute the transaction at the current market price. This practice is limited to funds that share the same investment adviser. The net realized gains or losses on sales of interfund transactions are recorded in Net realized gains (losses) on sales of securities —  unaffiliated issuers in the Statement of Operations. For the period ended August 31, 2026, the fund’s purchases and sales of securities with other funds in the Schwab Funds Complex was $9,854,044 and $56,915,519, respectively, and includes net realized gains of $202,865.

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 Schwab Funds 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 by the Board of Trustees. The fund had no interfund borrowing or lending activity during the period.

  4. Board of Trustees:

The Board of Trustees 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 persons or non-interested persons (independent trustees). The independent trustees are paid by the investment adviser pursuant to the Amended and Restated Advisory Agreement where the investment adviser pays the operational expenses of the fund which includes trustee fees.

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

13

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

 5. Borrowing from Banks:

During the period, the fund was a participant with other funds in the Schwab Funds Complex in a joint, syndicated, committed $1.2 billion line of credit (the Syndicated Credit Facility), maturing on October 22, 2026. 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 Schwab Funds Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility) with State Street Bank and Trust Company, maturing on October 22, 2026. 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, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

  6. Derivatives:

The fund entered into futures contracts during the report period to equitize available cash.

As of August 31, 2026, the Statement of Assets and Liabilities included the following financial derivative instrument fair values held at period end: 

The effects of the derivative contracts in the Statement of Operations for the period ended August 31, 2026, were: 

During the period ended August 31, 2026, the month-end average notional amounts of futures contracts held by the fund and the month-end average number of contracts held were as follows: 

  7. Purchases and Sales of Investment Securities:

For the period ended August 31, 2026, purchases and sales of securities (excluding in-kind transactions and short-term obligations) were as follows: 

14

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

 8. In-Kind Transactions:

The consideration for the purchase of Creation Units of the fund consists of the in-kind deposit of a designated portfolio of equity securities, which constitutes an optimized representation of the securities involved in the 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 are recorded in the Transactions In Fund Shares section in the Statement of Changes in Net Assets and generally have no effect on the 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, 2026, were as follows: 

For the period ended August 31, 2026, 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. The net realized gains or losses on sales of in-kind redemptions for the period ended August 31, 2026, if any, are disclosed in the fund’s Statement of Operations.

As described in the fund’s registration statement, when an investor is unable to deliver all or a portion of the in-kind basket of securities associated with a purchase of Creation Units or is unable to deliver all or a portion of the ETF shares associated with a redemption of Creation Units, the investor must pledge cash collateral on a daily marked-to-market basis in an amount at least equal to the market value of the missing securities or ETF shares. The trust, on behalf of the fund, is permitted to utilize the collateral to purchase the missing shares or acquire the securities at any time and the investor is liable for all costs associated with such purchases. Cash collateral amounts, if any, are disclosed in the fund’s Statement of Assets and Liabilities.

  9. Federal Income Taxes:

As of August 31, 2026, the tax basis cost of the fund’s investments and gross unrealized appreciation and depreciation were as follows: 

The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales. The tax cost of the fund’s investments, disclosed above, have been adjusted from its book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.

Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of February 28, 2026, the fund had capital loss carryforwards of $1,016,098,898.

The tax basis components of distributions and components of distributable earnings on a tax basis are finalized at fiscal year-end; accordingly, tax basis balances have not been determined as of August 31, 2026. The tax basis components of distributions paid during the fiscal year ended February 28, 2026, were as follows: 

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

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

15

Schwab U.S. REIT ETF

Financial Notes, unaudited (continued)

9. Federal Income Taxes (continued): 

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.

As of February 28, 2026, 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. During the fiscal year ended February 28, 2026, the fund did not incur any interest or penalties.

  10. 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.

16

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Changes in and Disagreements with Accountants for Open-End Management Investment Companies

Not applicable.

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

17

Proxy Disclosures for Open-End Management Investment Companies

Not applicable.

18

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies

The remuneration paid to directors, officers and others is included under Item 7 (Financial Statements and Financial Highlights for Open-End Management Investment Companies).

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

19

Schwab U.S. REIT ETF

Investment Advisory Agreement Approval

The Investment Company Act of 1940, as amended (the 1940 Act), requires that the continuation 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 agreement 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) calls and holds one or more meetings each year that are dedicated, in whole or in part, to considering whether to renew the investment advisory agreement (the Agreement) between Schwab Strategic Trust (the Trust) and Charles Schwab Investment Management, Inc. (dba Schwab Asset Management) (the investment adviser) with respect to the existing funds in the Trust, including Schwab U.S. REIT ETF (the Fund), and to review certain other agreements pursuant to which the investment adviser provides investment advisory services to certain other registered investment companies. In preparation for the meeting(s), the Board requests and reviews a wide variety of materials provided by the investment adviser, including information about the investment adviser’s affiliates, personnel, business goals and priorities, profitability, oversight of third-party service providers, corporate structure and operations. As part of the renewal process, the Independent Trustees’ legal counsel, on behalf of the Independent Trustees, sends an information request letter to the investment adviser seeking certain relevant information. The responses by the investment adviser are provided to the Trustees in the Board materials for their review prior to their meeting, and the Trustees are provided with the opportunity to request any additional materials. The Board also receives data provided by an independent provider of investment company data. This information is in addition to the detailed information about the Fund that the Board reviews during the course of each year, including information that relates to the Fund’s operations and performance, legal and compliance matters, risk management, portfolio turnover, and sales and marketing activity. In considering the renewal, the Independent Trustees receive advice from Independent Trustees’ legal counsel, including a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements. In addition, the Independent Trustees participate in question and answer sessions with representatives of the investment adviser and meet in executive session outside the presence of Fund management.

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 May 6, 2026 and June 10, 2026, and approved the renewal of the Agreement with respect to the Fund for an additional one-year term at the meeting on June 10, 2026 called for the purpose of voting on such approval.

The Board’s approval of the continuance of the Agreement with respect to the Fund was based on consideration and evaluation of a variety of specific factors discussed at these meetings and at prior meetings, including:

1.

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

2.

the Fund’s investment performance and how it compared to that of certain other comparable exchange-traded funds and benchmark data;

3.

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

4.

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

5.

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 provided by the investment adviser to the Fund and the resources of the investment adviser and its affiliates dedicated 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 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 the investment adviser’s continued investment in its infrastructure, including the investment adviser’s technology and use of data (including artificial intelligence tools), business continuity, cybersecurity, due diligence, risk management processes, and information security programs.

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Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

Schwab U.S. REIT ETF

The Trustees considered Schwab’s 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 provided by the investment adviser to the Fund and the resources of the investment adviser and its affiliates dedicated to the Fund supported renewal of the Agreement with respect to the Fund.

Fund Performance. The Board considered the Fund’s performance in determining whether to renew the Agreement with respect to the Fund. Specifically, the Trustees considered the Fund’s performance relative to a peer category of other exchange-traded funds and applicable indices/benchmarks, in light of total return and the market environment, as well as in consideration of the Fund’s investment style and strategy. As part of this review, the Trustees considered the composition of the peer category, selection criteria and the reputation of the independent provider of investment company data who prepared the peer category analysis. In evaluating the performance of the Fund, the Trustees considered the risk profile for the Fund and the Fund’s demonstrated performance in tracking its benchmark index. The Trustees noted that the Fund had closely tracked its index in 2025, performing in its expected performance range. The Trustees further considered the level of Fund performance in the context of their review of Fund expenses and the investment adviser’s profitability discussed below and also noted that the Board and a designated committee of the Board review performance throughout the year. Following such evaluation, the Board concluded, within the context of its full deliberations, that the performance of the Fund supported renewal of the Agreement with respect to the Fund.

Fund Expenses. With respect to the Fund’s expenses, the Board considered the rate of compensation called for by the Agreement and the Fund’s net 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 provision of services 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 U.S. REIT indexes. Following such evaluation, the Board concluded, within the context of its full deliberations, that the expenses of the Fund are reasonable and supported renewal of the Agreement with respect to the Fund.

Profitability. The Board considered the compensation flowing to the investment adviser and its affiliates, directly or indirectly and reviewed profitability on a pre-tax basis, without regard to distribution expenses. The Trustees reviewed profitability of the investment adviser relating to the Schwab fund complex as a whole, noting the benefits to Fund shareholders of being part of the Schwab fund complex, including the allocations of certain costs across the Fund and other funds in the complex. The Trustees also considered any other benefits 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 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 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 to benefit the Fund. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the profitability of the investment adviser is reasonable and supported renewal of the Agreement with respect to the Fund.

Economies of Scale. Although the Board recognized the difficulty of determining economies of scale with precision, and although the Fund does not have breakpoints in its advisory fee, the Trustees considered the potential existence of any economies of scale by way of the relatively low unitary fee structure of the Fund and whether those are passed along to the Fund’s shareholders through (i) the enhancement of services provided to the Fund in return for fees paid, including through the investment adviser’s continued investment in its infrastructure, including technology and use of data (including artificial intelligence tools), 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 a fund to scale and keeping overall expenses down as the fund grows. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the Fund obtains reasonable benefits from economies of scale.

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

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, approved the continuation 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

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

21

Schwab U.S. REIT ETF

services provided and the related expenses 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.

22

Schwab U.S. REIT ETF | Semiannual Holdings and Financial Statements

MFR63740-15
00327874

Semiannual Holdings and Financial Statements | August 31, 2026

Schwab Fundamental Index* ETFs

*

SCHWAB is a registered trademark of Charles Schwab & Co., Inc.
FUNDAMENTAL INDEX is a registered trademark of Research Affiliates LLC.

In This Report

Fund investment adviser: Charles Schwab Investment Management, Inc., dba Schwab Asset Management®

Distributor: SEI Investments Distribution Co. (SIDCO)

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and is the exclusive property of MSCI Inc. (MSCI) and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the Portfolio Holdings are sub-categories of Sector classifications. 

Schwab Fundamental Index ETFs | Semiannual Holdings and Financial Statements

1

Schwab Fundamental U.S. Broad Market ETF   

Financial Statements

FINANCIAL HIGHLIGHTS

See financial notes

2

Schwab Fundamental Index ETFs | Semiannual Holdings and Financial Statements

Schwab Fundamental U.S. Broad Market ETF

Portfolio Holdings  as of August 31, 2026 (Unaudited)