Global Technology Fund PRGTX. Global Technology Fund I Class PGTIX SEMIANNUAL REPORT

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1 SEMIANNUAL REPORT June 30, 2018 PRGTX T. ROWE PRICE Global Technology Fund PGTIX Global Technology Fund I Class The fund invests in foreign and U.S. companies that are primarily engaged in the technology sector. For more insights from T. Rowe Price investment professionals, go to troweprice.com.

2 HIGHLIGHTS The Global Technology Fund recorded a solid gain in the first half of 2018 but lagged its benchmark and peer group. The fund saw strong returns from its holdings in leading software and Internet firms. We raised our allocation to the more reasonably priced semiconductor segment, a positioning that has yet to pay off but should offer us upside potential as well as some protection in a general market downturn, should one occur. We are confident that our portfolio is very well positioned for the current environment highly differentiated and filled with good stocks trading at favorable prices. Go Paperless Sign up for e-delivery of your statements, confirmations, and prospectuses or shareholder reports. TO ENROLL: If you invest directly with T. Rowe Price, go to troweprice.com/paperless. If you invest through an investment advisor, a bank, or a brokerage firm, please contact that organization and ask if it can provide electronic documentation. It s fast receive your statements and confirmations faster than U.S. mail. It s convenient access your important account documents whenever you need them. It s secure we protect your online accounts using True Identity to confirm new accounts and make verification faster and more secure. It can save you money where applicable, T. Rowe Price passes on the cost savings to fund holders.* Log in to your account at troweprice.com for more information. * Certain mutual fund accounts that are assessed an annual account service fee can also save money by switching to e-delivery.

3 CIO Market Commentary Dear Shareholder U.S. stocks recorded decent gains in the first half of 2018, but unlike last year, investors had to absorb some bumps along the way. In February, volatility spiked and the S&P 500 Index briefly tumbled over 10% from its highs, putting it in correction territory. The major U.S. benchmarks recovered their losses in the spring, eventually bringing the technology-focused Nasdaq Composite Index and the smaller-cap indexes to new highs. Volatility stayed somewhat elevated, however, and many investors clearly remained anxious as the first half of your fund s fiscal year ended. Solid corporate and economic fundamentals initially seemed to promise that 2017 s strong stock market momentum might carry forward into Continued global synchronized growth led to strong profits for many multinationals. In the U.S., earnings for the S&P 500 rose by nearly 25% in the first quarter versus a year before, according to FactSet the best performance since the recovery from the financial crisis. Profit growth also picked up in Europe, Japan, and emerging markets, even as growth in many international economies cooled a bit. Inflation fears presented the first obstacle to the markets in February, however. Stocks tumbled on news that hourly wages had jumped in January, sparking fears that the Federal Reserve would pick up its pace of interest rate increases in order to head off inflation. Wage growth moderated in the following months, but a series of strong economic reports raised growth expectations and sent long-term interest rates to multiyear peaks by May. Investors also worried that the massive U.S. fiscal stimulus from December s tax cuts and March s spending bill might overheat the economy, though interest rates fell back in late May and June as Fed officials stressed their intention to move slowly in tightening monetary policy. Trade tensions soon emerged as a second impediment for the markets. The Trump administration began implementing a more populist trade stance in March, announcing tariffs on steel and aluminum imports, threatening to withdraw from the North American Free Trade Agreement (NAFTA), and later raising the possibility of taxing auto imports. The administration also announced a steady escalation in possible tariffs on Chinese goods, eventually targeting a list of $200 billion in Chinese imports. China and other U.S. trading partners vowed to retaliate proportionately. 1

4 Investors initially seemed willing to dismiss the tit-for-tat threats as negotiating tactics, but evidence eventually emerged that even the prospect of tariffs was impacting corporate strategies and profit outlooks. Stocks slumped on June 21, after German automaker Daimler lowered its earnings guidance due to possible tariff increases on SUVs it manufactures in the U.S. and sells in China. A few days later, Harley-Davidson revealed that it was planning to move some of its motorcycle production to Europe to avoid retaliatory tariffs recently announced by the European Union. Boeing, Caterpillar, and other leading exporters suffered declines as trade tensions worsened, but small-caps, which typically have far less international exposure, fared much better than large-caps in the first half of the year. Growth shares continued to outperform value shares despite the strong performance of energy stocks, which benefited from a rise in oil prices to multiyear highs. Stocks in overseas markets reacted particularly poorly to growing trade fears and fell for the period. A decline in many currencies relative to the dollar also weighed on international bond and stock returns for U.S. investors. Meanwhile, technology shares continued to dominate, with much of the market s overall gain to date in 2018 concentrated in a handful of mega-cap companies able to leverage dominant Internet platforms. Data breaches and concerns about the growing power of these firms resulted in calls for government intervention in early For now, however, the threat of increased regulation seems a longer-term one that appears minor in comparison to the powerful fundamental strength of these companies. T. Rowe Price s global team of industry experts is monitoring the possible impact of tariffs and other challenges on a wide range of companies from the global tech titans to small, domestic firms that get little analyst coverage on Wall Street. While the rest of 2018 may bring further surprises, you can rest assured that your portfolio manager is drawing on a wide range of insights in seeking to provide shareholders with superior returns while minimizing the impact of unforeseen political events or other pitfalls. Thank you for your continued confidence in T. Rowe Price. Sincerely, Robert Sharps Group Chief Investment Officer 2

5 Management s Discussion of Fund Performance INVESTMENT OBJECTIVE The fund seeks to provide long-term capital growth. FUND COMMENTARY How did the fund perform in the past six months? The Global Technology Fund returned 6.77% in the six months ended June 30, The fund lagged the MSCI All Country World Index Information Technology benchmark and its peer group, as measured by the Lipper Global Science/Technology Funds PERFORMANCE COMPARISON Index. (Returns for the Six-Month Period Ended 6/30/18 Global Technology Fund Global Technology Fund I Class Total Return 6.77% 6.83 I Class shares reflect a different fee structure. Past performance cannot guarantee future results.) MSCI All Country World Index Information Technology 7.35 What factors influenced the fund s performance? Lipper Global Science/Technology The growth of the cloudbased software industry Funds Index has been an important investment theme of ours for several years, and it continued to contribute to our results in the period. Salesforce.com s stock rose as the company continued to beat analyst growth expectations. We harvested our gains as the stock reached our price target in early May, but we remain optimistic about the company s prospects given its robust sales management products and its highly recurring subscription business model. Shares of Workday, the leading provider of cloud-based human resources software, rose on strong earnings results, fed by solid execution, healthy demand, and an expanding new business pipeline. We believe that the company is building momentum across its product lines, with its financial business taking a particular step forward thanks to recent customer wins. Traditional business and financial software firm Intuit, maker of TurboTax, is making the transition to the cloud, and the stock contributed nicely to results as it beat earnings estimates. (Please refer to the portfolio of investments for a complete list of holdings and the amount each represents in the portfolio.) Our Internet-oriented media and advertising holdings also performed well. Facebook experienced a highly publicized setback in March as the company came under scrutiny for unauthorized use of customer data. The stock quickly 3

6 recovered and reached new highs, however, after the company reported accelerating earnings and advertising revenues. We traded out of our Netflix shares early in the year, but we first enjoyed a healthy return as the company reported strong domestic subscriber gains in late 2017 even as it raised the price of its top-end service package. Foreign subscriber growth was also impressive, with the company enjoying success in bringing high-end original content to markets where television programming has historically suffered from low budgets and quality. Gaming was another source of strength for the portfolio. Electronic Arts performed well after the company reported solid first-quarter results, driven in particular by live services, such as revenues from esports competitions and in-game purchases. We believe the company will continue to benefit from its solid portfolio of existing franchises, while the long-term trend toward digital game distribution will benefit margins. Digital distribution should also be a tailwind for our new position in Take-Two Interactive Software, whose shares rose ahead of the long-awaited release of the sequel to the blockbuster Red Dead Redemption. The ongoing success of Grand Theft Auto has demonstrated the company s ability to draw substantial revenue streams from existing games. In previous letters, we have described our moves in and out of the highly volatile stock of Tesla, which has periodically been a major holding of the fund. The pioneering electric car maker had been pressured by worries over production delays for its first mass market vehicle, the Model 3, and the fund benefited as the stock rallied late in the period after CEO Elon Musk confirmed that the Model INDUSTRY DIVERSIFICATION IT Services 2% Telecom Equipment 2% Software 11% Hardware 11% Based on net assets as of 6/30/18. Telecom Services 1% Semiconductors 45% Internet 28% 3 s ramp-up remained on schedule. We trimmed our position significantly as the stock rose, feeling that the risk/return trade-off had grown less attractive at higher valuation levels. Our most significant detractor for the period was Japan s FANUC, a global leader in industrial robots and other factory automation systems. Despite reporting solid results in the fourth quarter of 2017, the stock 4

7 declined early in the year and fell further in April after the firm reported in-line first-quarter results along with conservative guidance. We also saw poor results from cybersecurity firm Symantec, which fell under a cloud in mid-may after the company lowered guidance for the year and announced that its financial results may have to be restated following an internal investigation based on information provided by a former employee. Should the outcome of the investigation prove benign, we are confident that the company will continue to enjoy healthy earnings growth as it makes acquisitions and consolidates a highly fragmented industry. Samsung Electronics shares fell on news that the Chinese government was investigating it and two other firms following allegations of price fixing in DRAM memory chips. We believe the company can improve earnings as well as profitability in its smartphone business. In addition, the firm s ample free cash flow should allow it to return more capital to shareholders. Semiconductor capital equipment maker Lam Research pulled back despite solid first-quarter earnings due to lower-than-expected guidance on shipments and general worries about declining prices for memory chips. We took advantage of the declines to build a position in the company, which seems well positioned to benefit from the increasing complexity in chip manufacturing as well as broadening demand for chips outside of mobile devices and personal computers. How is the fund positioned? In recent years, we have maintained a steady tilt to the portfolio involving a general emphasis on software over hardware, on insurgents rather than incumbents, and on companies that are using the Internet to disrupt traditional industries. We made significant changes in the fund s positioning in the first half of 2018, however. Most notably, we nearly tripled our allocation to the semiconductor segment, bringing our exposure up to its highest level in several years. This decision was driven largely by the relatively attractive valuations in the segment as valuations have soared for cloud-based software and Internet firms, semiconductor shares have experienced a correction. While we are not predicting an imminent recession or bear market, semiconductor shares have also proved resilient in past market downturns and have been among the first technology stocks to recover. What is portfolio management s outlook? We have been following the remarkable and durable growth prospects of leading technology companies for many years, but it is now fair to say that the secret is out enthusiastic investors have bid up the shares of these companies to heights that reflect not just this year s growth potential but also next year s, 5

8 in our view. For this reason, we have broadened our approach and layered on more cyclical exposure in the portfolio. This repositioning has yet to pay off for us, and it was an important factor in our lagging our benchmarks in the first half of the year. The fundamental investment process that we have used for many years remains intact, however, and our strong stock selection in software and media shares helped compensate for our reduced position in these top-performing segments. Indeed, we are confident that our portfolio is now in a very good position highly differentiated and filled with solid companies trading at good prices. The views expressed reflect the opinions of T. Rowe Price as of the date of this report and are subject to change based on changes in market, economic, or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results. 6

9 RISKS OF INVESTING IN THE FUND Securities of companies in the same industry may decline in price at the same time due to industry-specific developments since these companies may share common characteristics and are more likely to react similarly to industry-specific market or economic developments. Since this fund is focused on technology companies, it is less diversified than stock funds investing in a broader range of industries and, therefore, could experience significant volatility. In addition, technology stocks historically have experienced unusually wide price swings, both up and down. The potential for wide variation in performance reflects the special risks common to companies in the rapidly changing technology sector. For example, products or services that at first appear promising may not prove commercially successful or may become obsolete quickly. Earnings disappointments and intense competition for market share can result in sharp price declines. BENCHMARK INFORMATION Note: MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI. 7

10 PORTFOLIO HIGHLIGHTS TWENTY-FIVE LARGEST HOLDINGS Percent of net Assets 6/30/18 Tencent Holdings 11.7% Broadcom 7.5 Microchip Technology 5.7 Applied Materials 5.0 Lam Research 5.0 Alibaba Group Holding 4.9 Altaba 4.8 KLA-Tencor 4.7 Samsung Electronics 4.5 Taiwan Semiconductor Manufacturing 4.1 Texas Instruments 4.1 Alphabet 3.8 FANUC 3.8 Marvell Technology Group 3.2 Facebook 3.0 Symantec 2.7 Tesla 2.7 Hexagon 2.3 Ultimate Software Group 2.0 Renesas Electronics 1.6 Take-Two Interactive Software 1.6 Workday 1.6 Infineon Technologies 1.5 Equinix 1.3 Intuit 1.3 Total 94.4% Note: The information shown does not reflect any exchange-traded funds (ETFs), cash reserves, or collateral for securities lending that may be held in the portfolio. 8

11 GROWTH OF $10,000 This chart shows the value of a hypothetical $10,000 investment in the fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records). The result is compared with benchmarks, which include a broad-based market index and may also include a peer group average or index. Market indexes do not include expenses, which are deducted from fund returns as well as mutual fund averages and indexes. GLOBAL TECHNOLOGY FUND $70,000 58,000 46,000 34,000 22,000 10,000 6/08 6/09 6/10 6/11 6/12 6/13 6/14 6/15 6/16 6/17 6/18 As of 6/30/18 Global Technology Fund MSCI All Country World Index Information Technology Lipper Global Science/Technology Funds Index $58,504 32,639 38,201 Note: Performance for the I Class will vary due to its differing fee structure. See returns table below. AVERAGE ANNUAL COMPOUND TOTAL RETURN Since Inception Periods Ended 6/30/18 1 Year 5 Years 10 Years Inception Date Global Technology Fund 22.52% 26.77% 19.32% Global Technology Fund I Class % 11/29/16 The fund s performance information represents only past performance and is not necessarily an indication of future results. Current performance may be lower or higher than the performance data cited. Share price, principal value, and return will vary, and you may have a gain or loss when you sell your shares. For the most recent month-end performance, please visit our website (troweprice.com) or contact a T. Rowe Price representative at or, for I Class shares, This table shows how the fund would have performed each year if its actual (or cumulative) returns for the periods shown had been earned at a constant rate. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. Returns do not reflect taxes that the shareholder may pay on fund distributions or the redemption of fund shares. When assessing performance, investors should consider both short- and long-term returns. 9

12 EXPENSE RATIO Global Technology Fund 0.89% Global Technology Fund I Class 0.76 The expense ratio shown is as of the fund s fiscal year ended 12/31/17. This number may vary from the expense ratio shown elsewhere in this report because it is based on a different time period and, if applicable, includes acquired fund fees and expenses but does not include fee or expense waivers. FUND EXPENSE EXAMPLE As a mutual fund shareholder, you may incur two types of costs: (1) transaction costs, such as redemption fees or sales loads, and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other fund expenses. The following example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the most recent six-month period and held for the entire period. Please note that the fund has two share classes: The original share class (Investor Class) charges no distribution and service (12b-1) fee, and the I Class shares are also available to institutionally oriented clients and impose no 12b-1 or administrative fee payment. Each share class is presented separately in the table. Actual Expenses The first line of the following table (Actual) provides information about actual account values and expenses based on the fund s actual returns. You may use the information on this line, together with your account balance, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number on the first line under the heading Expenses Paid During Period to estimate the expenses you paid on your account during this period. Hypothetical Example for Comparison Purposes The information on the second line of the table (Hypothetical) is based on hypothetical account values and expenses derived from the fund s actual expense ratio and an assumed 5% per year rate of return before expenses (not the fund s actual return). You may compare the ongoing costs of investing in the fund with other funds by contrasting this 5% hypothetical example and the 5% hypothetical examples that appear in the shareholder reports of the other funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. 10

13 FUND EXPENSE EXAMPLE (CONTINUED) Note: T. Rowe Price charges an annual account service fee of $20, generally for accounts with less than $10,000. The fee is waived for any investor whose T. Rowe Price mutual fund accounts total $50,000 or more; accounts electing to receive electronic delivery of account statements, transaction confirmations, prospectuses, and shareholder reports; or accounts of an investor who is a T. Rowe Price Personal Services or Enhanced Personal Services client (enrollment in these programs generally requires T. Rowe Price assets of at least $250,000). This fee is not included in the accompanying table. If you are subject to the fee, keep it in mind when you are estimating the ongoing expenses of investing in the fund and when comparing the expenses of this fund with other funds. You should also be aware that the expenses shown in the table highlight only your ongoing costs and do not reflect any transaction costs, such as redemption fees or sales loads. Therefore, the second line of the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. To the extent a fund charges transaction costs, however, the total cost of owning that fund is higher. GLOBAL TECHNOLOGY FUND beginning ending Expenses Paid account Value Account Value During Period* 1/1/18 6/30/18 1/1/18 to 6/30/18 Investor Class Actual $1, $1, $4.61 Hypothetical (assumes 5% return before expenses) 1, , I Class Actual 1, , Hypothetical (assumes 5% return before expenses) 1, , *Expenses are equal to the fund s annualized expense ratio for the 6-month period, multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year (181), and divided by the days in the year (365) to reflect the half-year period. The annualized expense ratio of the Investor Class was 0.90%, and the I Class was 0.76%. 11

14 Unaudited FINANCIAL HIGHLIGHTS For a share outstanding throughout each period Investor Class 6 Months Ended 6/30/18 Year Ended 12/31/17 12/31/16 12/31/15 12/31/14 12/31/13 NET ASSET VALUE Beginning of period $ $ $ $ $ $ Investment activities Net investment income (loss) (1) 0.02 (0.06) (0.07) (0.06) (0.07) (2) Net realized and unrealized gain/loss Total from investment activities Distributions Net investment income (0.01) Net realized gain (2.66) (1.25) (1.36) (3.29) (1.36) Total distributions (2.66) (1.25) (1.36) (3.29) (1.37) NET ASSET VALUE End of period $ $ $ $ $ $

15 Unaudited FINANCIAL HIGHLIGHTS For a share outstanding throughout each period 6 Months Ended 6/30/18 Ratios/Supplemental Data Year Ended 12/31/17 12/31/16 12/31/15 12/31/14 12/31/13 Total return (3) 6.77% 47.04% 6.64% 21.06% 23.99% 39.92% Ratio of total expenses to average net assets 0.90% (4) 0.89% 0.90% 0.91% 0.91% 0.95% Ratio of net investment income (loss) to average net assets 0.19% (4) (0.37)% (0.49)% (0.47)% (0.49)% 0.04% Portfolio turnover rate 145.3% 204.3% 170.8% 219.4% 228.6% 93.2% Net assets, end of period (in millions) $ 5,970 $ 5,910 $ 3,153 $ 2,718 $ 1,626 $ 984 (1) (2) (3) (4) Per share amounts calculated using average shares outstanding method. Amounts round to less than $0.01 per share. Total return reflects the rate that an investor would have earned on an investment in the fund during each period, assuming reinvestment of all distributions. Total return is not annualized for periods less than one year. Annualized The accompanying notes are an integral part of these financial statements. 13

16 Unaudited FINANCIAL HIGHLIGHTS For a share outstanding throughout each period I Class 6 Months Ended 6/30/18 Year Ended 12/31/17 11/29/16 (1) Through 12/31/16 NET ASSET VALUE Beginning of period $ $ $ Investment activities Net investment income (loss) (2) 0.04 (0.04) (3) Net realized and unrealized gain/loss (0.34) (4) Total from investment activities (0.34) Distributions Net realized gain (2.68) (1.25) NET ASSET VALUE End of period $ $ $

17 Unaudited FINANCIAL HIGHLIGHTS For a share outstanding throughout each period Ratios/Supplemental Data 6 Months Ended 6/30/18 Year Ended 12/31/17 11/29/16 (1) Through 12/31/16 Total return (5) 6.83% 47.15% (2.35)% Ratio of total expenses to average net assets 0.76% (6) 0.76% 0.77% (6) Ratio of net investment income (loss) to average net assets 0.43% (6) (0.25)% 0.09% (6) Portfolio turnover rate 145.3% 204.3% 170.8% Net assets, end of period (in thousands) $ 567,340 $ 269,727 $ 16,871 (1) (2) (3) (4) (5) (6) Inception date Per share amounts calculated using average shares outstanding method. Amounts round to less than $0.01 per share. The amount presented is inconsistent with the fund's aggregate gains and losses because of the timing of sales and redemptions of fund shares in relation to fluctuating market values for the investment portfolio. Total return reflects the rate that an investor would have earned on an investment in the fund during each period, assuming reinvestment of all distributions. Total return is not annualized for periods less than one year. Annualized The accompanying notes are an integral part of these financial statements. 15

18 June 30, 2018 (Unaudited) PORTFOLIO OF INVESTMENTS Shares $ Value (Cost and value in $000s) COMMON STOCKS 99.6% HARDWARE 11.4% Consumer Electronics 4.5% Samsung Electronics (KRW) 7,073, , ,300 Imaging 0.4% Largan Precision (TWD) 176,000 25,855 25,855 Supply Chain/Electronic Manufacturing 6.5% FANUC (JPY) 1,252, ,161 Tesla (1) 505, , ,448 Total Hardware 743,603 INTERNET 28.2% Internet Media/ Advertising 18.6% Alphabet, Class C (1) 224, ,240 Facebook, Class A (1) 1,015, ,404 Tencent Holdings (HKD) 15,275, ,086 1,214,730 Internet Retail 9.6% Alibaba Group Holding, ADR (1) 1,712, ,701 Altaba (1)(2) 4,252, , ,012 Total Internet 1,843,742 IT SERVICES 1.5% IT Services 1.4% Equinix, REIT 205,100 88,170 88,170 16

19 (Cost and value in $000s) Shares $ Value Processors 0.1% Adyen (EUR)(1)(3) 10,233 5,638 5,638 Total IT Services 93,808 SEMICONDUCTORS 44.9% Analog Semiconductors 5.4% Maxim Integrated Products 1,474,302 86,483 Texas Instruments 2,447, , ,342 Digital Semiconductors 24.8% Broadcom 2,019, ,961 Infineon Technologies (EUR) 3,741,698 95,044 Marvell Technology Group 9,884, ,926 Microchip Technology 4,074, ,555 Renesas Electronics (JPY)(1) 10,815, ,731 Skyworks Solutions 340,599 32,919 Taiwan Semiconductor Manufacturing (TWD) 38,042, ,139 Xilinx 695,931 45,417 1,621,692 Semiconductor Capital Equipment 14.7% Applied Materials 7,091, ,533 KLA-Tencor 2,969, ,505 Lam Research 1,889, , ,716 Total Semiconductors 2,936,750 SOFTWARE 10.7% Applications Software 3.5% Ultimate Software Group (1) 498, ,298 Workday, Class A (1) 847, , ,926 Consumer Software 2.9% Intuit 428,265 87,497 17

20 (Cost and value in $000s) Shares $ Value Take-Two Interactive Software (1) 875, ,675 Enterprise Software 0.4% 191,172 Domo, Class D, Acquisition Date: 1/31/14, Cost $929 (1)(4) 14, Tableau Software, Class A (1) 288,653 28,216 Software & Services 0.1% 28,605 Dropbox, Class B, Acquisition Date: 5/1/12, Cost $1,941 (1)(4) 142,977 4,404 Systems Software 2.7% 4,404 Symantec 8,416, ,807 Technical Software 1.1% 173,807 Cadence Design Systems (1) 1,610,000 69,729 69,729 Total Software 698,643 TELECOM EQUIPMENT 2.3% Wireline Equipment 2.3% Hexagon, B Shares (SEK) 2,745, ,575 Total Telecom Equipment 152,575 TELECOM SERVICES 0.6% Towers 0.6% Crown Castle International, REIT 353,935 38,161 Total Telecom Services 38,161 Total Common Stocks (Cost $6,354,209) 6,507,282 CONVERTIBLE PREFERRED STOCKS 0.1% INTERNET 0.1% Internet Services 0.1% Xiaoju Kuaizhi, Class A-17, Acquisition Date: 10/19/15 Cost $2,272 (1)(4)(5) 82,853 4,007 Total Internet 4,007 18

21 (Cost and value in $000s) SOFTWARE 0.0% Shares $ Value Applications Software 0.0% Plex Systems, Series B, Acquisition Date: 6/9/14, Cost $1,264 (1)(4)(5) 551,025 1,174 Software & Services 0.0% 1,174 Evernote, Series 4, Acquisition Date: 5/2/12, Cost $1,338 (1)(4)(5) 111, Evernote, Series 5, Acquisition Date: 11/8/13, Cost $866 (1)(4)(5) 66, ,280 Total Software 2,453 Total Convertible Preferred Stocks (Cost $5,740) 6,460 SHORT-TERM INVESTMENTS 0.0% Money Market Funds 0.0% T. Rowe Price Treasury Reserve Fund, 1.88% (6)(7) 1,919,232 1,919 Total Short-Term Investments (Cost $1,919) 1,919 Total Investments in Securities 99.7% of Net Assets (Cost $6,361,868) $ 6,515,662 Shares are denominated in U.S. dollars unless otherwise noted. (1) Non-income producing (2) Organized as a closed-end management investment company. (3) Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be resold in transactions exempt from registration only to qualified institutional buyers -- total value of such securities at June 30, 2018 amounts to $5,638 and represents 0.1% of net assets. (4) Security cannot be offered for public resale without first being registered under the Securities Act of 1933 and related rules ("restricted security"). Acquisition date represents the day on which an enforceable right to acquire such security is obtained and is presented along with related cost in the security description. The fund has registration rights for certain restricted securities. Any costs related to such registration are borne by the issuer. The aggregate value of restricted securities (excluding 144A holdings) at period-end amounts to $11,253 and represents 0.2% of net assets. (5) Level 3 in fair value hierarchy. See Note 2. (6) Seven-day yield (7) Affiliated Company ADR American Depositary Receipts EUR Euro HKD Hong Kong Dollar 19

22 JPY Japanese Yen KRW South Korean Won REIT A domestic Real Estate Investment Trust whose distributions pass-through with original tax character to the shareholder SEK Swedish Krona TWD Taiwan Dollar 20

23 AFFILIATED COMPANIES ($000s) The fund may invest in certain securities that are considered affiliated companies. As defined by the 1940 Act, an affiliated company is one in which the fund owns 5% or more of the outstanding voting securities, or a company that is under common ownership or control. The following securities were considered affiliated companies for all or some portion of the six months ended June 30, Net realized gain (loss), investment income, change in net unrealized gain/loss, and purchases and sales reflect all activity for the period then ended. Affiliate Net Realized Gain (Loss) Change in Net Unrealized Gain/Loss Investment Income T. Rowe Price Treasury Reserve Fund $ $ $ 2,252 Totals $ # $ $ 2,252+ Supplementary Investment Schedule Value Affiliate 12/31/17 Purchase Cost Sales Cost Value 6/30/18 T. Rowe Price Treasury Reserve Fund $ 194,806 $ 1,919 $ 1,919^ # Capital gain distributions from mutual funds represented $0 of the net realized gain (loss). + Investment income comprised $2,252 of dividend income and $0 of interest income. Purchase and sale information not shown for cash management funds. ^ The cost basis of investments in affiliated companies was $1,919. The accompanying notes are an integral part of these financial statements. 21

24 June 30, 2018 (Unaudited) STATEMENT OF ASSETS AND LIABILITIES ($000s, except shares and per share amounts) Assets Investments in securities, at value (cost $6,361,868) $ 6,515,662 Receivable for investment securities sold 77,379 Dividends receivable 12,764 Receivable for shares sold 6,985 Other assets 393 Total assets 6,613,183 Liabilities Payable for investment securities purchased 63,345 Payable for shares redeemed 7,336 Investment management fees payable 4,133 Due to affiliates 132 Payable to directors 6 Other liabilities 549 Total liabilities 75,501 N E T A S S E T S $ 6, 5 3 7,

25 June 30, 2018 (Unaudited) STATEMENT OF ASSETS AND LIABILITIES ($000s, except shares and per share amounts) Net Assets Consist of: Undistributed net investment income $ 6,936 Accumulated undistributed net realized gain 1,151,811 Net unrealized gain 153,635 Paid-in capital applicable to 363,728,337 shares of $ par value capital stock outstanding; 1,000,000,000 shares authorized 5,225,300 N E T A S S E T S $ 6, 5 3 7, NET ASSET VALUE PER SHARE Investor Class ($5,970,341,676 / 332,199,784 shares outstanding) $ I Class ($567,340,173 / 31,528,553 shares outstanding) $ The accompanying notes are an integral part of these financial statements. 23

26 Unaudited STATEMENT OF OPERATIONS ($000s) 6 Months Ended 6/30/18 Investment Income (Loss) Dividend income (net of foreign taxes of $3,137) $ 36,876 Expenses Investment management 24,808 Shareholder servicing Investor Class $ 4,442 I Class 4 4,446 Prospectus and shareholder reports Investor Class 138 I Class Custody and accounting 226 Registration 216 Legal and audit 25 Directors 13 Proxy and annual meeting 32 Miscellaneous 34 Total expenses 29,940 Net investment income 6,936 24

27 Unaudited STATEMENT OF OPERATIONS ($000s) 6 Months Ended 6/30/18 Realized and Unrealized Gain / Loss Net realized gain (loss) Securities 981,669 Foreign currency transactions (101) Net realized gain 981,568 Change in net unrealized gain / loss Securities (576,508) Other assets and liabilities denominated in foreign currencies (160) Change in net unrealized gain / loss (576,668) Net realized and unrealized gain / loss 404,900 INCREASE IN NET ASSETS FROM OPERATIONS $ 411,836 The accompanying notes are an integral part of these financial statements. 25

28 Unaudited STATEMENT OF CHANGES IN NET ASSETS ($000s) 6 Months Ended 6/30/18 Year Ended 12/31/17 Increase (Decrease) in Net Assets Operations Net investment income (loss) $ 6,936 $ (18,164) Net realized gain 981,568 1,117,805 Change in net unrealized gain / loss (576,668) 602,110 Increase in net assets from operations 411,836 1,701,751 Distributions to shareholders Net realized gain Investor Class (817,747) I Class (34,565) Decrease in net assets from distributions (852,312) Capital share transactions* Shares sold Investor Class 801,136 2,417,080 I Class 345, ,744 Distributions reinvested Investor Class 756,669 I Class 30,723 Shares redeemed Investor Class (1,136,188) (1,270,546) I Class (64,289) (22,147) Increase (decrease) in net assets from capital share transactions (53,969) 2,160,523 26

29 Unaudited STATEMENT OF CHANGES IN NET ASSETS ($000s) 6 Months Ended 6/30/18 Year Ended 12/31/17 Net Assets Increase during period 357,867 3,009,962 Beginning of period 6,179,815 3,169,853 E n d o f p e r i o d $ 6, 5 3 7, $ 6, 1 7 9, Undistributed net investment income 6,936 *Share information Shares sold Investor Class 44, ,774 I Class 19,034 14,180 Distributions reinvested Investor Class 44,095 I Class 1,789 Shares redeemed Investor Class (63,184) (74,089) I Class (3,527) (1,224) Increase (decrease) in shares outstanding (3,528) 127,525 The accompanying notes are an integral part of these financial statements. 27

30 Unaudited NOTES TO FINANCIAL STATEMENTS, Inc. (the fund), is registered under the Investment Company Act of 1940 (the 1940 Act) as a nondiversified, open-end management investment company. The fund seeks to provide long-term capital growth. The fund has two classes of shares: the Global Technology Fund (Investor Class) and the Global Technology Fund I Class (I Class). I Class shares generally are available only to investors meeting a $1,000,000 minimum investment or certain other criteria. Each class has exclusive voting rights on matters related solely to that class; separate voting rights on matters that relate to both classes; and, in all other respects, the same rights and obligations as the other class. NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES Basis of Preparation The fund is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 (ASC 946). The accompanying financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (GAAP), including, but not limited to, ASC 946. GAAP requires the use of estimates made by management. Management believes that estimates and valuations are appropriate; however, actual results may differ from those estimates, and the valuations reflected in the accompanying financial statements may differ from the value ultimately realized upon sale or maturity. Investment Transactions, Investment Income, and Distributions Investment transactions are accounted for on the trade date basis. Income and expenses are recorded on the accrual basis. Realized gains and losses are reported on the identified cost basis. Dividends received from mutual fund investments are reflected as dividend income; capital gain distributions are reflected as realized gain/loss. Dividend income and capital gain distributions are recorded on the ex-dividend date. Income tax-related interest and penalties, if incurred, are recorded as income tax expense. Distributions from REITs are initially recorded as dividend income and, to the extent such represent a return of capital or capital gain for tax purposes, are reclassified when such information becomes available. Income distributions, if any, are declared and paid by each class annually. Distributions to shareholders are recorded on the ex-dividend date. A capital gain distribution may also be declared and paid by the fund annually. Currency Translation Assets, including investments, and liabilities denominated in foreign currencies are translated into U.S. dollar values each day at the prevailing exchange rate, using the mean of the bid and asked prices of such currencies against U.S. dollars as quoted by a major bank. Purchases and sales of securities, income, and 28

31 expenses are translated into U.S. dollars at the prevailing exchange rate on the respective date of such transaction. The portion of the results of operations attributable to changes in foreign exchange rates on investments is not bifurcated from the portion attributable to changes in market prices. The effect of changes in foreign currency exchange rates on realized and unrealized security gains and losses is reflected as a component of security gains and losses. Class Accounting Shareholder servicing, prospectus, and shareholder report expenses incurred by each class are charged directly to the class to which they relate. Expenses common to both classes, investment income, and realized and unrealized gains and losses are allocated to the classes based upon the relative daily net assets of each class. To the extent any expenses are waived or reimbursed in accordance with an expense limitation (see Note 6), the waiver or reimbursement is charged to the applicable class or allocated across the classes in the same manner as the related expense. New Accounting Guidance In March 2017, the FASB issued amended guidance to shorten the amortization period for certain callable debt securities held at a premium. The guidance is effective for fiscal years and interim periods beginning after December 15, Adoption will have no effect on the fund s net assets or results of operations. Indemnification In the normal course of business, the fund may provide indemnification in connection with its officers and directors, service providers, and/or private company investments. The fund s maximum exposure under these arrangements is unknown; however, the risk of material loss is currently considered to be remote. NOTE 2 - VALUATION The fund s financial instruments are valued and each class s net asset value (NAV) per share is computed at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET, each day the NYSE is open for business. However, the NAV per share may be calculated at a time other than the normal close of the NYSE if trading on the NYSE is restricted, if the NYSE closes earlier, or as may be permitted by the SEC. Fair Value The fund s financial instruments are reported at fair value, which GAAP defines as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The T. Rowe Price Valuation Committee (the Valuation Committee) is an internal committee that has been delegated certain responsibilities by the fund s Board of Directors (the Board) to ensure that financial instruments are appropriately priced at fair value in accordance with GAAP and the 1940 Act. Subject to oversight by the Board, the Valuation Committee develops and oversees pricing-related policies and procedures and approves all fair value determinations. Specifically, the Valuation Committee 29

32 establishes procedures to value securities; determines pricing techniques, sources, and persons eligible to effect fair value pricing actions; oversees the selection, services, and performance of pricing vendors; oversees valuation-related business continuity practices; and provides guidance on internal controls and valuation-related matters. The Valuation Committee reports to the Board and has representation from legal, portfolio management and trading, operations, risk management, and the fund s treasurer. Various valuation techniques and inputs are used to determine the fair value of financial instruments. GAAP establishes the following fair value hierarchy that categorizes the inputs used to measure fair value: Level 1 quoted prices (unadjusted) in active markets for identical financial instruments that the fund can access at the reporting date Level 2 inputs other than Level 1 quoted prices that are observable, either directly or indirectly (including, but not limited to, quoted prices for similar financial instruments in active markets, quoted prices for identical or similar financial instruments in inactive markets, interest rates and yield curves, implied volatilities, and credit spreads) Level 3 unobservable inputs Observable inputs are developed using market data, such as publicly available information about actual events or transactions, and reflect the assumptions that market participants would use to price the financial instrument. Unobservable inputs are those for which market data are not available and are developed using the best information available about the assumptions that market participants would use to price the financial instrument. GAAP requires valuation techniques to maximize the use of relevant observable inputs and minimize the use of unobservable inputs. When multiple inputs are used to derive fair value, the financial instrument is assigned to the level within the fair value hierarchy based on the lowest-level input that is significant to the fair value of the financial instrument. Input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level but rather the degree of judgment used in determining those values. Valuation Techniques Equity securities listed or regularly traded on a securities exchange or in the over-the-counter (OTC) market are valued at the last quoted sale price or, for certain markets, the official closing price at the time the valuations are made. OTC Bulletin Board securities are valued at the mean of the closing bid and asked prices. A security that is listed or traded on more than one exchange is valued at the quotation on the exchange determined to be the primary market for such security. Listed securities not traded on a particular day are valued at the mean of the closing bid and asked prices for domestic securities and the last quoted sale or closing price for international securities. 30

33 For valuation purposes, the last quoted prices of non-u.s. equity securities may be adjusted to reflect the fair value of such securities at the close of the NYSE. If the fund determines that developments between the close of a foreign market and the close of the NYSE will affect the value of some or all of its portfolio securities, the fund will adjust the previous quoted prices to reflect what it believes to be the fair value of the securities as of the close of the NYSE. In deciding whether it is necessary to adjust quoted prices to reflect fair value, the fund reviews a variety of factors, including developments in foreign markets, the performance of U.S. securities markets, and the performance of instruments trading in U.S. markets that represent foreign securities and baskets of foreign securities. The fund may also fair value securities in other situations, such as when a particular foreign market is closed but the fund is open. The fund uses outside pricing services to provide it with quoted prices and information to evaluate or adjust those prices. The fund cannot predict how often it will use quoted prices and how often it will determine it necessary to adjust those prices to reflect fair value. As a means of evaluating its security valuation process, the fund routinely compares quoted prices, the next day s opening prices in the same markets, and adjusted prices. Actively traded equity securities listed on a domestic exchange generally are categorized in Level 1 of the fair value hierarchy. Non-U.S. equity securities generally are categorized in Level 2 of the fair value hierarchy despite the availability of quoted prices because, as described above, the fund evaluates and determines whether those quoted prices reflect fair value at the close of the NYSE or require adjustment. OTC Bulletin Board securities, certain preferred securities, and equity securities traded in inactive markets generally are categorized in Level 2 of the fair value hierarchy. Investments in mutual funds are valued at the mutual fund s closing NAV per share on the day of valuation and are categorized in Level 1 of the fair value hierarchy. Assets and liabilities other than financial instruments, including short-term receivables and payables, are carried at cost, or estimated realizable value, if less, which approximates fair value. Thinly traded financial instruments and those for which the above valuation procedures are inappropriate or are deemed not to reflect fair value are stated at fair value as determined in good faith by the Valuation Committee. The objective of any fair value pricing determination is to arrive at a price that could reasonably be expected from a current sale. Financial instruments fair valued by the Valuation Committee are primarily private placements, restricted securities, warrants, rights, and other securities that are not publicly traded. Subject to oversight by the Board, the Valuation Committee regularly makes good faith judgments to establish and adjust the fair valuations of certain securities as events occur and circumstances warrant. For instance, in determining the fair value of an equity investment with limited market activity, such as a private placement or a thinly 31

34 traded public company stock, the Valuation Committee considers a variety of factors, which may include, but are not limited to, the issuer s business prospects, its financial standing and performance, recent investment transactions in the issuer, new rounds of financing, negotiated transactions of significant size between other investors in the company, relevant market valuations of peer companies, strategic events affecting the company, market liquidity for the issuer, and general economic conditions and events. In consultation with the investment and pricing teams, the Valuation Committee will determine an appropriate valuation technique based on available information, which may include both observable and unobservable inputs. The Valuation Committee typically will afford greatest weight to actual prices in arm s length transactions, to the extent they represent orderly transactions between market participants, transaction information can be reliably obtained, and prices are deemed representative of fair value. However, the Valuation Committee may also consider other valuation methods such as market-based valuation multiples; a discount or premium from market value of a similar, freely traded security of the same issuer; or some combination. Fair value determinations are reviewed on a regular basis and updated as information becomes available, including actual purchase and sale transactions of the issue. Because any fair value determination involves a significant amount of judgment, there is a degree of subjectivity inherent in such pricing decisions, and fair value prices determined by the Valuation Committee could differ from those of other market participants. Depending on the relative significance of unobservable inputs, including the valuation technique(s) used, fair valued securities may be categorized in Level 2 or 3 of the fair value hierarchy. Valuation Inputs The following table summarizes the fund s financial instruments, based on the inputs used to determine their fair values on June 30, 2018 (for further detail by category, please refer to the accompanying Portfolio of Investments): ($000s) Level 1 Level 2 Level 3 Total Value Assets Common Stocks $ 4,535,961 $ 1,971,322 $ $ 6,507,283 Convertible Preferred Stocks 6,460 6,460 Short-Term Investments 1,919 1,919 Total $ 4,537,880 $ 1,971,322 $ 6,460 $ 6,515,662 There were no material transfers between Levels 1 and 2 during the six months ended June 30,