Global Technology Fund Semi-Annual Report · before sales charge Putnam Global Technology Fund ... synchronized global growth recovery, led by ... Global Sector Global Technology

Putnam Global Technology Fund

FUND SYMBOL CLASS A

PGTAX

Semiannual report 2 | 28 | 18

This global sector fund invests in stocks of technology companies worldwide.

http://www.putnam.com/?ref=722.pdf

Putnam Global Technology FundSemiannual report 2 | 28 | 18

Message from the Trustees 1

About the fund 2

Interview with your fund’s portfolio managers 5

Your fund’s performance 9

Your fund’s expenses 11

Terms and definitions 13

Other information for shareholders 14

Financial statements 15

Consider these risks before investing: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Investments in small and/or midsize companies increase the risk of greater price fluctuations. The technology industries may be affected by technological obsolescence, short product cycles, falling prices and profits, competitive pressures, and general market conditions. The fund concentrates on a limited group of industries and is non-diversified. Because the fund may invest in fewer issuers than a diversified fund, it is vulnerable to common economic forces and may result in greater losses and volatility. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. The use of short selling may result in losses if the securities appreciate in value. Risks associated with derivatives include increased investment exposure (which may be considered leverage) and, in the case of over-the-counter instruments, the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instru-ment to meet its obligations. Stock prices may fall or fail to rise over time for several reasons, including general financial market conditions, changing market perceptions, changes in government intervention in the financial markets, and factors related to a specific issuer or industry. These and other factors may lead to increased volatility and reduced liquidity in the fund’s portfolio holdings. You can lose money by investing in the fund.

April 11, 2018

Dear Fellow Shareholder:

After an extended period of record advances and low volatility, the U.S. stock market encountered some challenges in early 2018. Following several turbulent days, the S&P 500 Index entered correction territory on February 8, 2018, closing more than 10% below its January 2018 peak. Global stock and bond markets have also struggled as concerns grow about rising inflation and interest rates.

While declines like this can be unsettling, seasoned investors recognize that they are natural and ultimately can restore balance in the financial markets. In this changing environment, Putnam’s experienced investment professionals continue to monitor risks and seek opportunities. They take a research-intensive approach to investing that includes risk management strategies designed to serve investors in all types of markets.

As always, we believe investors should maintain a well-diversified portfolio, think about long-term goals, and speak regularly with their financial advisors. In the following pages, you will find an overview of your fund’s performance for the reporting period as well as an outlook for the coming months.

Thank you for investing with Putnam.

Respectfully yours,

Robert L. ReynoldsPresident and Chief Executive OfficerPutnam Investments

Jameson A. BaxterChair, Board of Trustees

Message from the Trustees

Most areas of the economy are influenced by technology — from emerging companies with revolutionary new products to traditional businesses dependent on technological innovation. The fund’s managers, with support from analysts in Putnam’s Equity Research group, look across industries to find stocks that can help investors build wealth over time. Companies in the portfolio may range from computer hardware, software, storage, and security to technology consulting and internet services.

2008Number of internet users surpasses one billion

201564% of American adults own a smart-phone, up from 35% in 2011

About the fund

Pursuing growth opportunities in technology companies worldwideIn 1937, the year Putnam Investments was founded, a law student named Chester Carlson developed an innovative process for reproducing words on a page in just minutes. Despite the usefulness of his invention, he had a difficult time finding investors for his photocopier — which did not become commercially available until the Xerox Corporation began selling it in 1950.

Successful investing, particularly in the technology sector, requires the ability to identify the value of a product, service, or business, and to capitalize on its long-term growth potential.

Putnam Global Technology Fund seeks to capitalize on the potential of this sector — and the many innovations that are still to come. The fund combines the growth potential of technology stocks with Putnam’s investment expertise, research capabilities, and global reach.

The fund can invest worldwide in small entrepreneurial firms, midsize companies with significant market share in new industries, and well-established giants with years of profitability.

1958The integrated circuit is introduced; also known as a “chip,” it revolutionizes the world of electronics

1971IBM introduces the first memory disc, an 8-inch plastic disc called “floppy” because of its flexibility

1982TIME magazine names the computer “Machine of the Year”; a year earlier, IBM had introduced the PC

1989Tim Berners-Lee builds the first internet browser, the World Wide Web

Developments and events that have affected the technology sector

The fund’s 2008 inception post-dates many of these developments.

Sector investing at PutnamIn recent decades, innovation and business growth have propelled stocks in different industries to market-leading performance. Finding these stocks, many of which are in international markets, requires rigorous research and in-depth knowledge of global markets.

Putnam’s sector funds invest in eight sectors worldwide and offer active management, risk controls, and the expertise of dedicated sector analysts. The funds’ managers invest with flexibility and precision, using fundamental research to hand select stocks for the portfolios.

ALL SECTORS IN ONE FUND:Putnam Global Sector Fund A portfolio of individual Putnam Global Sector Funds that provides exposure to all sectors of the MSCI World Index [ND].

INDIVIDUAL SECTOR FUNDS:Global Consumer Fund Retail, hotels, restaurants, media, food and beverages

Global Financials Fund Commercial banks, insurance, diversified financial services, mortgage finance

Global Health Care Fund Pharmaceuticals, biotechnology, health-care services

Global Industrials Fund Airlines, railroads, trucking, aerospace and defense, construction, commercial services

Global Natural Resources Fund Metals, chemicals, oil and gas, forest products

Global Technology Fund Software, computers, internet services

Global Telecommunications Fund Diversified and wireless telecommunications services

Global Utilities Fund Electric, gas, and water utilities

Global Technology Fund 3 2 Global Technology Fund

Performance history as of 2/28/18

Annualized total return (%) comparison

LIFE OF FUND(since 12/18/08)

5 YEARS 3 YEARS 1 YEAR 6 MONTHS*

19.11 18.7022.74

20.3524.06

18.38

42.25

35.47

14.8417.44

The fund — class A sharesbefore sales chargePutnam Global Technology Fund (PGTAX)

Fund’s benchmarkMSCI World Information Technology Index (ND)

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will fluctuate, and you may have a gain or a loss when you sell your shares. Performance of class A shares assumes reinvestment of distributions and does not account for taxes. Fund returns in the bar chart do not reflect a sales charge of 5.75%; had they, returns would have been lower. See below and pages 9–10 for additional performance information. For a portion of the periods, the fund had expense limitations, without which returns would have been lower. To obtain the most recent month-end performance, visit putnam.com.

* Returns for the six-month period are not annualized, but cumulative.

Recent broad market index and fund performance

17.44%

14.84%

10.84%

0.58%

–2.18%

Fund’s benchmark (MSCI World Information Technology Index (ND))

Putnam Global Technology Fund (class A shares before sales charge)

U.S. stocks (S&P 500 Index)

Cash (ICE BofAML U.S. 3-Month Treasury Bill Index)

U.S. bonds (Bloomberg Barclays U.S. Aggregate Bond Index)

This comparison shows your fund’s performance in the context of broad market indexes for the six months ended 2/28/18. See above and pages 9–10 for additional fund performance information. Index descriptions can be found on pages 13–14.

4 Global Technology Fund

https://www.putnam.com?ref=722.pdf

Interview with your fund’s portfolio managers

Neil P. DesaiPortfolio Manager

Neil has an M.B.A. from Harvard Business School and a B.A. in Economics from Duke University. He joined Putnam in 2012 and has been in the investment industry since 1997.

Di YaoPortfolio Manager

Di has an M.B.A. from Columbia University, an M.S. in Computer Science from the University of Massachusetts, Boston, and a B.S. in Biochemistry from Fudan University, China. He has been in the investment industry since he joined Putnam in 2005.

Please describe the investing environment for the six-month reporting period.DI It was a favorable period for markets in general and for the global technology sector in particular. World markets continued their strong march in the latter half of 2017, led by the United States. The technology sector continued to outperform the broader market during this period. Companies that we follow across the technology spectrum continued to post strong earnings growth, including those in the United States and Europe.

NEIL We have also been in the midst of a synchronized global growth recovery, led by the United States. That has proven to be a positive backdrop for equities in general. The U.S. Congress, with the support of the Trump administration, in December passed a compre-hensive tax bill that included a reduction in the corporate tax rate to 21% from 35%. This law is widely seen as a near- to medium-term positive factor for corporations in the United States.

Investor sentiment remained upbeat and market volatility subdued until early February, when volatility spiked for a two-week period before normalizing. During this period, the dollar continued to slide against other major

Neil Desai and Di Yao discuss the investment environment and fund performance for the six-month period ended February 28, 2018, and their outlook for technology stocks in the months ahead.

Interview with your fund’s portfolio managers

Performance history as of 2/28/18

Annualized total return (%) comparison

LIFE OF FUND(since 12/18/08)

5 YEARS 3 YEARS 1 YEAR 6 MONTHS*

19.11 18.7022.74

20.3524.06

18.38

42.25

35.47

14.8417.44

The fund — class A sharesbefore sales chargePutnam Global Technology Fund (PGTAX)

Fund’s benchmarkMSCI World Information Technology Index (ND)

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will fluctuate, and you may have a gain or a loss when you sell your shares. Performance of class A shares assumes reinvestment of distributions and does not account for taxes. Fund returns in the bar chart do not reflect a sales charge of 5.75%; had they, returns would have been lower. See below and pages 9–10 for additional performance information. For a portion of the periods, the fund had expense limitations, without which returns would have been lower. To obtain the most recent month-end performance, visit putnam.com.

* Returns for the six-month period are not annualized, but cumulative.

Recent broad market index and fund performance

17.44%

14.84%

10.84%

0.58%

–2.18%

Fund’s benchmark (MSCI World Information Technology Index (ND))

Putnam Global Technology Fund (class A shares before sales charge)

U.S. stocks (S&P 500 Index)

Cash (ICE BofAML U.S. 3-Month Treasury Bill Index)

U.S. bonds (Bloomberg Barclays U.S. Aggregate Bond Index)

This comparison shows your fund’s performance in the context of broad market indexes for the six months ended 2/28/18. See above and pages 9–10 for additional fund performance information. Index descriptions can be found on pages 13–14.

Global Technology Fund 5


Top 10 holdingsHOLDING (PERCENTAGE OF FUND’S NET ASSETS) COUNTRY OVER/UNDERWEIGHT VS. BENCHMARK

Alphabet, Inc. (11.5%) United States

Microsoft Corp. (8.2%) United States

Facebook, Inc. (5.3%) United States

Visa, Inc. (3.8%) United States

Alibaba Group Holding, Ltd. (3.4%) China

DXC Technology Co. (2.8%) United States

Tencent Holdings, Ltd. (2.5%) China

Sino-American Silicon Products, Inc. (2.4%) Taiwan

Delivery Hero Holding GmbH (2.4%) Germany

Toshiba Corp. (2.3%) Japan 2.3%

2.2%

–1.3%

–0.5%

0.7%

2.4%

2.5%

2.4%

2.4%

3.4%

This table shows the fund’s top 10 holdings by percentage of the fund’s net assets as of 2/28/18. Short-term investments and derivatives, if any, are excluded. Holdings may vary over time.

Global composition

United States 55.4%

China 10.5

Japan 8.8

Taiwan 6.5

France 4.0

South Korea 3.2

Germany 2.4

United Kingdom 2.2

Other countries 3.3

Cash and net other assets 3.7

Allocations are shown as a percentage of the fund’s net assets as of 2/28/18. Cash and net other assets, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Summary information may differ from the information in the portfolio schedule notes included in the financial statements due to the inclusion of derivative securities, any interest accruals, the exclusion of as-of trades, if any, and rounding. Holdings and allocations may vary over time.


currencies. A weaker dollar provided a tailwind for U.S.-based exporters. A depreciating dollar tends to lift corporate profits, especially for those firms with sales in foreign currencies.

How did the fund perform?NEIL The fund returned 14.84% compared with 17.44% for its benchmark index, the MSCI World Information Technology Index [ND]. Almost half of the fund’s underperformance was due to sector allocation. The portfolio had an underweight position in communication equipment stocks, a group that outperformed the market, and an overweight in internet software companies, which underperformed. We believe this adverse performance trend is a short-term phenomenon.

What stocks contributed to performance?DI The fund benefited from an out-of-benchmark position in U.S. tech giant Amazon.com [Amazon]. We believe that Amazon is among the world’s most valuable companies, and we see more growth potential ahead. The stock has surged over the past year, boosted by revenue growth as more shopping activity moves online and businesses shift their computing operations to the cloud, where Amazon Web Services has led the market. We expect the company’s relentless expansion into cloud computing, groceries, and other new businesses to yield results over the long term.

NEIL Another top performer was Germany’s Aixtron, a semiconductor production equipment maker. Aixtron has a leading global position in compound semiconductor manu-facturing. We expect the market for applications such as 3D sensing for smartphones and silicon carbide for electric vehicles to take off among consumers and businesses. 3D-sensing tech-nology could be used for such applications as facial recognition. Both of these innovations will see explosive growth in the next few years, in our view. We believe that Aixtron will benefit from selling equipment that is used to manufac-ture the chips for such applications. We sold our position in Aixtron in the reporting period.

What stocks detracted?DI One of the top detractors was Qudian, a Chinese financial company. An out-of- benchmark pick, Qudian provides loans to individuals and small businesses. We partic-ipated in the stock’s initial public offering in October 2017. The company’s shares have tumbled since its listing on the New York Stock Exchange because of investor concerns about regulatory risks and governance. We sold our position in Qudian by period-end.

Micro Focus International, a U.K. technology company that helps develop software systems, was another detractor. We were overweight the stock relative to the benchmark index. The firm has been struggling to integrate the software division of U.S.-based Hewlett Packard Enterprise, which it purchased in 2017. Earnings growth has disappointed, and the company said in March that year-on-year revenue decline will be greater than expected.

What is the outlook for the market?DI Early 2018 has turned out to be more volatile than 2017. Despite strong underlying funda-mentals for technology companies, stock performance may be affected by external risks, including trade protectionism, the trajectory of U.S. interest rates, and geopolitical conflicts, in our view. We continue to believe technology companies, which improve global produc-tivity with their innovations, will continue to outperform the broader market over the long term.

NEIL As such, we see market volatility as an advantage, and we will selectively add to

We continue to believe technology companies, which improve global productivity with their innovations, will continue to outperform the broader market over the long term. Di Yao


high-conviction names on market weakness. We will continue to manage the Global Technology Fund on a bottom-up basis, analyzing fundamental data stock by stock and seeking companies that have positive earnings estimates and high barriers to entry in their respective sectors.

Thank you, Neil and Di, for your time and insights on the fund.

The views expressed in this report are exclusively those of Putnam Management and are subject to change. They are not meant as investment advice.

Please note that the holdings discussed in this report may not have been held by the fund for the entire period. Portfolio composition is subject to review in accordance with the fund’s investment strategy and may vary in the future. Current and future portfolio holdings are subject to risk.

Comparison of top industry weightings

30.9%32.5%

Internet software and services

as of 8/31/17

as of 2/28/18

8.1%7.9%

IT services

1.8%8.7%

Electronic equipment, instruments, and components

14.6%14.1%

Semiconductors and semiconductor equipment

16.3%21.4%

Software

This chart shows the fund’s largest allocation shifts, by percentage, over the past six months. Allocations are shown as a percentage of the fund’s net assets. Current period summary information may differ from the portfolio schedule included in the financial statements due to the inclusion of derivative securities, any interest accruals, the exclusion of as-of trades, if any, the use of different classifications of securities for presentation purposes, and rounding. Holdings and allocations may vary over time.


Your fund’s performanceThis section shows your fund’s performance, price, and distribution information for periods ended February 28, 2018, the end of the first half of its current fiscal year. In accordance with regulatory requirements for mutual funds, we also include performance information as of the most recent calendar quarter-end and expense information taken from the fund’s current prospectus. Performance should always be considered in light of a fund’s investment strategy. Data represent past performance. Past performance does not guarantee future results. More recent returns may be less or more than those shown. Investment return and principal value will fluctuate, and you may have a gain or a loss when you sell your shares. Performance information does not reflect any deduction for taxes a shareholder may owe on fund distributions or on the redemption of fund shares. For the most recent month-end performance, please visit the Individual Investors section at putnam.com or call Putnam at 1-800-225-1581. Class R and Y shares are not available to all investors. See the Terms and Definitions section in this report for definitions of the share classes offered by your fund.

Fund performance Total return for periods ended 2/28/18

Life of fund

Annual average 5 years


Annual average 1 year 6 months

Class A (12/18/08)

Before sales charge 398.97% 19.11% 178.59% 22.74% 90.95% 24.06% 42.25% 14.84%

After sales charge 370.28 18.34 162.57 21.30 79.97 21.64 34.07 8.24

Class B (12/18/08)

Before CDSC 369.65 18.32 168.23 21.82 86.68 23.13 41.19 14.41

After CDSC 369.65 18.32 166.23 21.63 83.68 22.47 36.19 9.41

Class C (12/18/08)

Before CDSC 365.76 18.22 168.17 21.81 86.64 23.12 41.22 14.39

After CDSC 365.76 18.22 168.17 21.81 86.64 23.12 40.22 13.39

Class M (12/18/08)

Before sales charge 376.46 18.51 171.59 22.12 88.12 23.45 41.58 14.55


Class R (12/18/08)

Net asset value 387.58 18.81 175.08 22.43 89.47 23.74 41.91 14.69

Class Y (12/18/08)

Net asset value 410.33 19.40 181.93 23.03 92.31 24.36 42.61 14.94

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. After-sales-charge returns for class A and M shares reflect the deduction of the maximum 5.75% and 3.50% sales charge, respectively, levied at the time of purchase. Class B share returns after contingent deferred sales charge (CDSC) reflect the applicable CDSC, which is 5% in the first year, declining over time to 1% in the sixth year, and is eliminated thereafter. Class C share returns after CDSC reflect a 1% CDSC for the first year that is eliminated thereafter. Class R and Y shares have no initial sales charge or CDSC.

For a portion of the periods, the fund had expense limitations, without which returns would have been lower.

Class B share performance reflects conversion to class A shares after eight years.


https://www.putnam.com/?ref=722.pdf

Comparative index returns For periods ended 2/28/18

Life of fund




MSCI World Information Technology Index (ND) 383.46% 18.70% 152.46% 20.35% 65.88% 18.38% 35.47% 17.44%

Index results should be compared with fund performance before sales charge, before CDSC, or at net asset value.

Fund price and distribution information For the six-month period ended 2/28/18

Distributions Class A Class B Class C Class M Class R Class Y

Number 1 1 1 1 1 1

Income — — — — — —

Capital gains

Long-term gains $0.530 $0.530 $0.530 $0.530 $0.530 $0.530

Short-term gains 1.847 1.847 1.847 1.847 1.847 1.847

Total $2.377 $2.377 $2.377 $2.377 $2.377 $2.377

Share value

Before sales

charge

After sales

charge

Net asset value

Net asset value

Before sales

charge

After sales

charge

Net asset value

Net asset value

8/31/17 $34.20 $36.29 $32.06 $32.05 $32.79 $33.98 $33.52 $34.90

2/28/18 36.75 38.99 34.16 34.14 35.04 36.31 35.92 37.59

The classification of distributions, if any, is an estimate. Before-sales-charge share value and current dividend rate for class A and M shares, if applicable, do not take into account any sales charge levied at the time of purchase. After-sales-charge share value, current dividend rate, and current 30-day SEC yield, if applicable, are calculated assuming that the maximum sales charge (5.75% for class A shares and 3.50% for class M shares) was levied at the time of purchase. Final distribution information will appear on your year-end tax forms.

Fund performance as of most recent calendar quarter Total return for periods ended 3/31/18

Life of fund




Class A (12/18/08)

Before sales charge 396.53% 18.84% 171.15% 22.08% 93.68% 24.65% 34.86% 12.14%


Class B (12/18/08)

Before CDSC 367.35 18.07 161.22 21.17 89.40 23.73 33.86 11.72

After CDSC 367.35 18.07 159.22 20.99 86.40 23.07 28.86 6.72

Class C (12/18/08)

Before CDSC 363.31 17.95 161.25 21.17 89.42 23.73 33.88 11.76

After CDSC 363.31 17.95 161.25 21.17 89.42 23.73 32.88 10.76

Class M (12/18/08)

Before sales charge 373.88 18.24 164.60 21.48 90.82 24.04 34.19 11.89


Class R (12/18/08)

Net asset value 385.13 18.54 167.83 21.78 92.21 24.33 34.54 12.01

Class Y (12/18/08)

Net asset value 408.02 19.13 174.56 22.38 95.16 24.97 35.23 12.30

See the discussion following the fund performance table on page 9 for information about the calculation of fund performance.


Your fund’s expensesAs a mutual fund investor, you pay ongoing expenses, such as management fees, distribution fees (12b-1 fees), and other expenses. Using the following information, you can estimate how these expenses affect your investment and compare them with the expenses of other funds. You may also pay one-time transaction expenses, including sales charges (loads) and redemption fees, which are not shown in this section and would have resulted in higher total expenses. For more information, see your fund’s prospectus or talk to your financial representative.

Expense ratiosClass A Class B Class C Class M Class R Class Y

Net expenses for the fiscal year ended 8/31/17* 1.28% 2.03% 2.03% 1.78% 1.53% 1.03%

Total annual operating expenses for the fiscal year ended 8/31/17 1.32% 2.07% 2.07% 1.82% 1.57% 1.07%

Annualized expense ratio for the six-month period ended 2/28/18 1.17% 1.92% 1.92% 1.67% 1.42% 0.92%

Fiscal-year expense information in this table is taken from the most recent prospectus, is subject to change, and may differ from that shown for the annualized expense ratio and in the financial highlights of this report.

Expenses are shown as a percentage of average net assets. * Reflects Putnam Management’s contractual obligation to limit certain fund expenses through 12/30/18.

Expenses per $1,000The following table shows the expenses you would have paid on a $1,000 investment in each class of the fund from 9/1/17 to 2/28/18. It also shows how much a $1,000 investment would be worth at the close of the period, assuming actual returns and expenses.

Class A Class B Class C Class M Class R Class Y

Expenses paid per $1,000*† $6.23 $10.21 $10.21 $8.88 $7.56 $4.90

Ending value (after expenses) $1,148.40 $1,144.10 $1,143.90 $1,145.50 $1,146.90 $1,149.40

* Expenses for each share class are calculated using the fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of average net assets for the six months ended 2/28/18. The expense ratio may differ for each share class.

† Expenses are calculated by multiplying the expense ratio by the average account value for the period; then multiplying the result by the number of days in the period; and then dividing that result by the number of days in the year.


Estimate the expenses you paidTo estimate the ongoing expenses you paid for the six months ended 2/28/18, use the following calculation method. To find the value of your investment on 9/1/17, call Putnam at 1-800-225-1581.

How to calculate the expenses you paid

Value of your investment on 9/1/17 ÷ $1,000 x Expenses paid per $1,000 = Total expenses paid

Example Based on a $10,000 investment in class A shares of your fund.

$10,000 ÷ $1,000 x $6.23 (see preceding table) = $62.30

Compare expenses using the SEC’s methodThe Securities and Exchange Commission (SEC) has established guidelines to help investors assess fund expenses. Per these guidelines, the following table shows your fund’s expenses based on a $1,000 investment, assuming a hypothetical 5% annualized return. You can use this information to compare the ongoing expenses (but not transaction expenses or total costs) of investing in the fund with those of other funds. All mutual fund shareholder reports will provide this information to help you make this comparison. Please note that you cannot use this information to estimate your actual ending account balance and expenses paid during the period.

Class A Class B Class C Class M Class R Class Y

Expenses paid per $1,000*† $5.86 $9.59 $9.59 $8.35 $7.10 $4.61

Ending value (after expenses) $1,018.99 $1,015.27 $1,015.27 $1,016.51 $1,017.75 $1,020.23

* Expenses for each share class are calculated using the fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of average net assets for the six months ended 2/28/18. The expense ratio may differ for each share class.

† Expenses are calculated by multiplying the expense ratio by the average account value for the six-month period; then multiplying the result by the number of days in the six-month period; and then dividing that result by the number of days in the year.


Terms and definitions

Important termsTotal return shows how the value of the fund’s shares changed over time, assuming you held the shares through the entire period and reinvested all distributions in the fund.

Before sales charge, or net asset value, is the price, or value, of one share of a mutual fund, without a sales charge. Before-sales-charge figures fluctuate with market conditions, and are calculated by dividing the net assets of each class of shares by the number of outstanding shares in the class.

After sales charge is the price of a mutual fund share plus the maximum sales charge levied at the time of purchase. After-sales-charge perfor-mance figures shown here assume the 5.75% maximum sales charge for class A shares and 3.50% for class M shares.

Contingent deferred sales charge (CDSC) is generally a charge applied at the time of the redemption of class B or C shares and assumes redemption at the end of the period. Your fund’s class B CDSC declines over time from a 5% maximum during the first year to 1% during the sixth year. After the sixth year, the CDSC no longer applies. The CDSC for class C shares is 1% for one year after purchase.

Share classesClass A shares are generally subject to an initial sales charge and no CDSC (except on certain redemptions of shares bought without an initial sales charge).

Class B shares are closed to new investments and are only available by exchange from another Putnam fund or through dividend and/or capital gains reinvestment. They are not subject to an initial sales charge and may be subject to a CDSC.

Class C shares are not subject to an initial sales charge and are subject to a CDSC only if the shares are redeemed during the first year.

Class M shares have a lower initial sales charge and a higher 12b-1 fee than class A shares and no CDSC.

Class R shares are not subject to an initial sales charge or CDSC and are only available to employer-sponsored retirement plans.

Class Y shares are not subject to an initial sales charge or CDSC, and carry no 12b-1 fee. They are generally only available to corporate and institutional clients and clients in other approved programs.

Comparative indexesBloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index of U.S. investment-grade fixed-income securities.

ICE BofAML (Intercontinental Exchange Bank of America Merrill Lynch) U.S. 3-Month Treasury Bill Index is an unmanaged index that seeks to measure the performance of U.S. Treasury bills available in the marketplace.

MSCI World Information Technology Index (ND) is a free float-adjusted market capital-ization weighted index that is designed to measure the equity market performance of developed markets in the information technology sector. Calculated with net dividends (ND), this total return index reflects the reinvestment of dividends after the deduction of withholding taxes, using a tax rate applicable to non-resident institutional investors who do not benefit from double taxation treaties.

S&P 500 Index is an unmanaged index of common stock performance.ICE Data Indices, LLC (“ICE BofAML”), used with permis-sion. ICE BofAML permits use of the ICE BofAML indices and related data on an “as is” basis; makes no warran-ties regarding same; does not guarantee the suitability, quality, accuracy, timeliness, and/or completeness of the ICE BofAML indices or any data included in, related to, or derived therefrom; assumes no liability in connec-tion with the use of the foregoing; and does not sponsor, endorse, or recommend Putnam Investments, or any of its products or services.


Indexes assume reinvestment of all distributions and do not account for fees. Securities and performance of a

fund and an index will differ. You cannot invest directly in an index.

Other information for shareholders

Important notice regarding delivery of shareholder documentsIn accordance with Securities and Exchange Commission (SEC) regulations, Putnam sends a single copy of annual and semiannual shareholder reports, prospectuses, and proxy statements to Putnam shareholders who share the same address, unless a shareholder requests otherwise. If you prefer to receive your own copy of these documents, please call Putnam at 1-800-225-1581, and Putnam will begin sending individual copies within 30 days.

Proxy votingPutnam is committed to managing our mutual funds in the best interests of our shareholders. The Putnam funds’ proxy voting guidelines and procedures, as well as information regarding how your fund voted proxies relating to portfolio securities during the 12-month period ended June 30, 2017, are available in the Individual Investors section of putnam.com, and on the SEC’s website, www.sec.gov. If you have questions about finding forms on the SEC’s website, you may call the SEC at 1-800-SEC-0330. You may also obtain the Putnam funds’ proxy voting guidelines and

procedures at no charge by calling Putnam’s Shareholder Services at 1-800-225-1581.

Fund portfolio holdingsThe fund will file a complete schedule of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Shareholders may obtain the fund’s Form N-Q on the SEC’s website at www.sec.gov. In addition, the fund’s Form N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. You may call the SEC at 1-800-SEC-0330 for information about the SEC’s website or the operation of the Public Reference Room.

Trustee and employee fund ownershipPutnam employees and members of the Board of Trustees place their faith, confidence, and, most importantly, investment dollars in Putnam mutual funds. As of February 28, 2018, Putnam employees had approximately $528,000,000 and the Trustees had approxi-mately $81,000,000 invested in Putnam mutual funds. These amounts include investments by the Trustees’ and employees’ immediate family members as well as investments through retirement and deferred compensation plans.



Financial statements


Financial statements

These sections of the report, as well as the accompanying Notes, constitute the fund’s financial statements.

The fund’s portfolio lists all the fund’s investments and their values as of the last day of the reporting period. Holdings are organized by asset type and industry sector, country, or state to show areas of concentration and diversification.

Statement of assets and liabilities shows how the fund’s net assets and share price are determined. All investment and non-investment assets are added together. Any unpaid expenses and other liabilities are subtracted from this total. The result is divided by the number of shares to determine the net asset value per share, which is calculated separately for each class of shares. (For funds with preferred shares, the amount subtracted from total assets includes the liquidation preference of preferred shares.)

Statement of operations shows the fund’s net investment gain or loss. This is done by first adding up all the fund’s earnings — from dividends and interest income — and subtracting its operating expenses to determine net investment income (or loss). Then, any net gain or loss the fund realized on the sales of its holdings — as well as any unrealized gains or losses over the period — is added to

or subtracted from the net investment result to determine the fund’s net gain or loss for the fiscal period.

Statement of changes in net assets shows how the fund’s net assets were affected by the fund’s net investment gain or loss, by distributions to shareholders, and by changes in the number of the fund’s shares. It lists distributions and their sources (net investment income or realized capital gains) over the current reporting period and the most recent fiscal year-end. The distributions listed here may not match the sources listed in the Statement of operations because the distributions are determined on a tax basis and may be paid in a different period from the one in which they were earned. Dividend sources are estimated at the time of declaration. Actual results may vary. Any non-taxable return of capital cannot be determined until final tax calculations are completed after the end of the fund’s fiscal year.

Financial highlights provide an overview of the fund’s investment results, per-share distributions, expense ratios, net investment income ratios, and portfolio turnover in one summary table, reflecting the five most recent reporting periods. In a semiannual report, the highlights table also includes the current reporting period.


COMMON STOCKS (94.5%)* Shares ValueElectronic equipment, instruments, and components (7.2%)Orbotech, Ltd. (Israel) † 106,186 $5,835,983Sunny Optical Technology Group Co., Ltd. (China) 258,000 4,283,717TDK Corp. (Japan) 34,700 3,135,660Universal Display Corp. 27,856 3,615,709Walsin Technology Corp. (Taiwan) 1,634,000 4,764,743

21,635,812Health-care equipment and supplies (1.5%)Hoya Corp. (Japan) 83,400 4,394,195

4,394,195Industrial conglomerates (2.3%)Toshiba Corp. (Japan) † 2,375,000 7,013,702

7,013,702Internet and direct marketing retail (1.7%)Amazon.com, Inc. † 3,423 5,177,116

5,177,116Internet software and services (32.4%)Alibaba Group Holding, Ltd. ADR (China) † S 55,097 10,255,756Alphabet, Inc. Class C † 31,231 34,501,823Delivery Hero Holding GmbH (Germany) † 165,073 7,248,376DeNA Co., Ltd. (Japan) 72,000 1,305,286Facebook, Inc. Class A † 89,584 15,974,619GoDaddy, Inc. Class A † 90,759 5,428,296Instructure, Inc. † S 128,406 5,572,820LogMeIn, Inc. 29,751 3,437,728MuleSoft, Inc. Class A † S 156,874 4,844,269Tencent Holdings, Ltd. (China) 138,500 7,595,862YY, Inc. ADR (China) † 11,590 1,498,935

97,663,770IT Services (7.8%)DXC Technology Co. 81,523 8,359,368Fidelity National Information Services, Inc. 40,423 3,928,307Visa, Inc. Class A 92,118 11,324,987

23,612,662Media (1.3%)Charter Communications, Inc. Class A † 2,875 983,049Live Nation Entertainment, Inc. † S 62,280 2,790,144

3,773,193Semiconductors and semiconductor equipment (14.1%)ams AG (Austria) 36,138 4,265,832Broadcom, Ltd. 11,074 2,729,298Ferrotec Holdings Corp. (Japan) 180,000 4,441,223Globalwafers Co., Ltd. (Taiwan) 93,000 1,315,970Holtek Semiconductor, Inc. (Taiwan) 872,000 2,356,622ON Semiconductor Corp. † 190,469 4,556,018Qorvo, Inc. † 43,020 3,472,144SCREEN Holdings Co., Ltd. (Japan) 65,000 6,037,377Sino-American Silicon Products, Inc. (Taiwan) 2,450,000 7,324,252STMicroelectronics NV (France) 263,061 6,013,332

42,512,068

The fund’s portfolio 2/28/18 (Unaudited)


COMMON STOCKS (94.5%)* cont. Shares ValueSoftware (21.4%)Activision Blizzard, Inc. 25,014 $1,829,274Adobe Systems, Inc. † 16,534 3,457,755Ellie Mae, Inc. † S 28,583 2,534,455Everbridge, Inc. † S 134,840 4,302,744Micro Focus International PLC ADR (United Kingdom) S 232,191 6,515,279Microsoft Corp. 262,752 24,638,255NCSOFT Corp. (South Korea) 14,907 5,099,496Oracle Corp. 61,053 3,093,556RealPage, Inc. † 77,820 4,066,095salesforce.com, Inc. † 22,613 2,628,761Talend SA ADR (France) † S 130,709 6,153,780

64,319,450Technology hardware, storage, and peripherals (4.8%)Apple, Inc. 17,259 3,074,173Casetek Holdings, Ltd. (Taiwan) 1,172,131 3,794,218Lenovo Group, Ltd. (China) 6,282,000 3,262,658Samsung Electronics Co., Ltd. (South Korea) 2,032 4,403,994

14,535,043Total common stocks (cost $227,922,751) $284,637,011

WARRANTS (1.5%)* † Expiration date

Strike price Warrants Value

Hangzhou Hikvision Digital Technology Co., Ltd. 144A (China) 2/11/19 $0.00 680,000 $4,571,636Total warrants (cost $4,463,732) $4,571,636

CONVERTIBLE PREFERRED STOCKS (0.0%)* Shares ValueUber Technologies, Inc. Ser. E, 8.00% cv. pfd. (acquired 2/18/15, cost $152,246) (Private) † ∆∆ F $4,502 $148,322Total convertible preferred stocks (cost $152,246) $148,322

SHORT-TERM INVESTMENTS (10.8%)*Principal amount/

shares ValuePutnam Cash Collateral Pool, LLC 1.65% d Shares 24,580,400 $24,580,400Putnam Short Term Investment Fund 1.54% L Shares 7,307,214 7,307,214U.S. Treasury Bills 1.403%, 4/5/18 $11,000 10,984U.S. Treasury Bills 1.436%, 5/10/18 ∆ 111,000 110,664U.S. Treasury Bills 1.438%, 4/19/18 ∆ 242,000 241,492U.S. Treasury Bills 1.491%, 6/7/18 132,000 131,422Total short-term investments (cost $32,382,304) $32,382,176

TOTAL INVESTMENTSTotal investments (cost $264,921,033) $321,739,145


Key to holding’s abbreviations

ADR American Depository Receipts: represents ownership of foreign securities on deposit with a custodian bank

Notes to the fund’s portfolio

Unless noted otherwise, the notes to the fund’s portfolio are for the close of the fund’s reporting period, which ran from September 1, 2017 through February 28, 2018 (the reporting period). Within the following notes to the portfolio, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC and references to “ASC 820” represent Accounting Standards Codification 820 Fair Value Measurements and Disclosures.

* Percentages indicated are based on net assets of $301,109,424.

† This security is non-income-producing.

∆∆ This security is restricted with regard to public resale. The total fair value of this security and any other restricted securities (excluding 144A securities), if any, held at the close of the reporting period was $148,322, or less than 0.1% of net assets.

∆ This security, in part or in entirety, was pledged and segregated with the custodian for collateral on certain derivative contracts at the close of the reporting period. Collateral at period end totaled $243,390 and is included in Investments in securities on the Statement of assets and liabilities (Notes 1 and 8).

d Affiliated company. See Notes 1 and 5 to the financial statements regarding securities lending. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.

F This security is valued by Putnam Management at fair value following procedures approved by the Trustees. Securities are classified as Level 3 for ASC 820 based on the securities’ valuation inputs. At the close of the reporting period, fair value pricing was also used for certain foreign securities in the portfolio (Note 1).

L Affiliated company (Note 5). The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.

S Security on loan, in part or in entirety, at the close of the reporting period (Note 1).

At the close of the reporting period, the fund maintained liquid assets totaling $184,681 to cover certain derivative contracts.

Unless otherwise noted, the rates quoted in Short-term investments security descriptions represent the weighted average yield to maturity.

Debt obligations are considered secured unless otherwise indicated.

144A after the name of an issuer represents securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.

DIVERSIFICATION BY COUNTRY ⌂

Distribution of investments by country of risk at the close of the reporting period, excluding collateral received, if any (as a percentage of Portfolio Value):

United States 58.6%China 10.6Japan 8.9Taiwan 6.6France 4.1South Korea 3.2

Germany 2.4%United Kingdom 2.2Israel 2.0Austria 1.4Total 100.0%

⌂ Methodology differs from that used for purposes of complying with the fund’s policy regarding investments in securities of foreign issuers, as discussed further in the fund’s prospectus.


FORWARD CURRENCY CONTRACTS at 2/28/18 (aggregate face value $31,428,971 ) (Unaudited)

Counterparty CurrencyContract

type*Delivery

date ValueAggregate face value

Unrealized appreciation/

(depreciation)Bank of America N.A.

British Pound Sell 3/21/18 $5,711,259 $5,681,777 $(29,482 )Canadian Dollar Buy 4/18/18 1,104,598 1,133,950 (29,352 )

Euro Sell 3/21/18 45,693 44,138 (1,555 )Barclays Bank PLC

Hong Kong Dollar Buy 5/16/18 9,104 9,114 (10 )Citibank, N.A.

Euro Sell 3/21/18 2,448,486 2,396,958 (51,528 )Japanese Yen Buy 5/16/18 49,090 51,021 (1,931 )

Credit Suisse InternationalSwedish Krona Buy 3/21/18 528,796 526,906 1,890

Goldman Sachs InternationalBritish Pound Buy 3/21/18 367,063 374,601 (7,538 )

Chinese Yuan (Offshore) Sell 5/16/18 3,582,447 3,594,913 12,466Euro Sell 3/21/18 690,282 675,169 (15,113 )

HSBC Bank USA, National AssociationEuro Sell 3/21/18 983,133 1,001,602 18,469

JPMorgan Chase Bank N.A.Euro Sell 3/21/18 3,749,149 3,868,388 119,239

Japanese Yen Sell 5/16/18 577,028 563,195 (13,833 )Swedish Krona Buy 3/21/18 875,724 903,936 (28,212 )

State Street Bank and Trust Co.Canadian Dollar Buy 4/18/18 609,670 625,831 (16,161 )

Israeli Shekel Sell 4/18/18 4,809,377 4,896,184 86,807Japanese Yen Sell 5/16/18 5,207,588 5,081,288 (126,300 )

Unrealized appreciation 238,871Unrealized (depreciation) (321,015 )Total $(82,144 )

* The exchange currency for all contracts listed is the United States Dollar.


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

ASC 820 establishes a three-level hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of the fund’s investments. The three levels are defined as follows:

Level 1: Valuations based on quoted prices for identical securities in active markets.Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.Level 3: Valuations based on inputs that are unobservable and significant to the fair value measurement.

The following is a summary of the inputs used to value the fund’s net assets as of the close of the reporting period:

Valuation inputsInvestments in securities: Level 1 Level 2 Level 3

Common stocks*:Consumer discretionary $8,950,309 $— $— Health care — 4,394,195 — Industrials — 7,013,702 — Information technology 187,630,187 76,648,618 —

Total common stocks 196,580,496 88,056,515 —

Convertible preferred stocks — — 148,322

Warrants — 4,571,636 —

Short-term investments 7,307,214 25,074,962 — Totals by level $203,887,710 $117,703,113 $148,322

Valuation inputsOther financial instruments: Level 1 Level 2 Level 3Forward currency contracts $— $(82,144 ) $— Totals by level $— $(82,144 ) $—

* Common stock classifications are presented at the sector level, which may differ from the fund’s portfolio presentation.

During the reporting period, transfers within the fair value hierarchy, if any (other than certain transfers involving non-U.S. equity securities as described in Note 1 ), did not represent, in the aggregate, more than 1% of the fund’s net assets measured as of the end of the period. Transfers are accounted for using the end of period pricing valuation method.

At the start and close of the reporting period, Level 3 investments in securities represented less than 1% of the fund’s net assets and were not considered a significant portion of the fund’s portfolio.

Statement of assets and liabilities 2/28/18 (Unaudited)

ASSETSInvestment in securities, at value, including $23,918,320 of securities on loan (Notes 1 and 8):

Unaffiliated issuers (identified cost $233,033,419) $289,851,531 Affiliated issuers (identified cost $31,887,614) (Notes 1 and 5) 31,887,614

Cash 2 Foreign currency (cost $20) (Note 1) 20 Dividends, interest and other receivables 227,726 Receivable for shares of the fund sold 4,163,949 Receivable for sales of delayed delivery securities (Note 1) 145,880 Unrealized appreciation on forward currency contracts (Note 1) 238,871 Prepaid assets 69,108 Total assets 326,584,701

LIABILITIESPayable for shares of the fund repurchased 170,506 Payable for compensation of Manager (Note 2) 137,272 Payable for custodian fees (Note 2) 13,063 Payable for investor servicing fees (Note 2) 82,876 Payable for Trustee compensation and expenses (Note 2) 5,472 Payable for administrative services (Note 2) 788 Payable for distribution fees (Note 2) 88,809 Unrealized depreciation on forward currency contracts (Note 1) 321,015 Collateral on securities loaned, at value (Note 1) 24,580,400 Other accrued expenses 75,076 Total liabilities 25,475,277

Net assets $301,109,424

REPRESENTED BYPaid-in capital (Unlimited shares authorized) (Notes 1 and 4) $237,346,185 Distributions in excess of net investment income (Note 1) (698,020)Accumulated net realized loss on investments and foreign currency transactions (Note 1) 7,725,844 Net unrealized appreciation of investments and assets and liabilities in foreign currencies 56,735,415 Total — Representing net assets applicable to capital shares outstanding $301,109,424

(Continued on next page)



Statement of assets and liabilities cont.

COMPUTATION OF NET ASSET VALUE AND OFFERING PRICENet asset value and redemption price per class A share ($161,024,533 divided by 4,381,587 shares) $36.75 Offering price per class A share (100/94.25 of $36.75)* $38.99 Net asset value and offering price per class B share ($8,581,041 divided by 251,209 shares)** $34.16 Net asset value and offering price per class C share ($27,943,690 divided by 818,452 shares)** $34.14 Net asset value and redemption price per class M share ($2,701,085 divided by 77,097 shares)† $35.04 Offering price per class M share (100/96.50 of $35.04)* $36.31 Net asset value, offering price and redemption price per class R share ($1,047,120 divided by 29,148 shares) $35.92 Net asset value, offering price and redemption price per class Y share ($99,811,955 divided by 2,655,027 shares) $37.59

*On single retail sales of less than $50,000. On sales of $50,000 or more the offering price is reduced.**Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.†Net asset value may not recalculate due to rounding of fractional shares



Statement of operations Six months ended 2/28/18 (Unaudited)

INVESTMENT INCOMEDividends (net of foreign tax of $35,257) $754,726 Interest (including interest income of $55,434 from investments in affiliated issuers) (Note 5) 56,325 Securities lending (net of expenses) (Notes 1 and 5) 36,667 Total investment income 847,718

EXPENSESCompensation of Manager (Note 2) 749,308 Investor servicing fees (Note 2) 225,775 Custodian fees (Note 2) 17,756 Trustee compensation and expenses (Note 2) 5,455 Distribution fees (Note 2) 314,957 Administrative services (Note 2) 4,252 Other 100,896 Total expenses 1,418,399

Expense reduction (Note 2) (1,755)Net expenses 1,416,644

Net investment loss (568,926)

REALIZED AND UNREALIZED GAIN (LOSS)Net realized gain (loss) on:

Securities from unaffiliated issuers (Notes 1 and 3) 13,924,426 Foreign currency transactions (Note 1) (60,122)Forward currency contracts (Note (1) (290,155)

Total net realized gain 13,574,149 Change in net unrealized appreciation (depreciation) on:

Securities in unaffiliated issuers 18,953,993 Assets and liabilities in foreign currencies (664)Forward currency contracts (211,104)

Total change in net unrealized appreciation 18,742,225

Net gain on investments 32,316,374

Net increase in net assets resulting from operations $31,747,448



Statement of changes in net assets

INCREASE IN NET ASSETS Six months ended 2/28/18* Year ended 8/31/17OperationsNet investment loss $(568,926) $(420,094)Net realized gain on investments and foreign currency transactions 13,574,149 11,007,323 Net unrealized appreciation of investments and assets and liabilities in foreign currencies 18,742,225 26,873,123 Net increase in net assets resulting from operations 31,747,448 37,460,352 Distributions to shareholders (Note 1):

From ordinary incomeNet investment income

Class A — (228,198)Class B — (6,162)Class C — (11,487)Class M — (1,168)Class R — (1,567)Class Y — (240,322)

Net realized short-term gain on investmentsClass A (6,598,696) (62,612)Class B (423,199) (8,945)Class C (1,226,459) (13,254)Class M (111,241) (720)Class R (37,092) (526)Class Y (4,106,244) (50,772)

From net realized long-term gain on investmentsClass A (1,893,508) — Class B (121,438) — Class C (351,934) — Class M (31,921) — Class R (10,643) — Class Y (1,178,294) —

Increase from capital share transactions (Note 4) 103,475,485 86,543,519 Total increase in net assets 119,132,264 123,378,138

NET ASSETSBeginning of period 181,977,160 58,599,022End of period (including distributions in excess of net investment income of $698,020 and $129,094, respectively) $301,109,424 $181,977,160

*Unaudited.



This page left blank intentionally.



See notes to financial highlights at the end of this section.

Financial highlights (For a common share outstanding throughout the period)

INVESTMENT OPERATIONS LESS DISTRIBUTIONS RATIOS AND SUPPLEMENTAL DATA

Period ended

Net asset value,

beginning of period

Net investment income (loss ) a

Net realized and unrealized gain (loss) on investments

Total from investment operations

From net investment

income

From net realized

gain on investments

Total dis tri bu tions

Redemption fees

Net asset value, end of period

Total return at net asset value (% ) b

Net assets, end of period

(in thousands )

Ratio of expenses

to average net assets

(% ) c

Ratio of net investment

income (loss) to average

net assets (% )

Portfolio turnover

(% )

Class A February 28, 2018 * * $34.20 (.08 ) 5.01 4.93 — (2.38 ) (2.38 ) — $36.75 14.84 * $161,025 .58 * (.23 )* 43 * August 31, 2017 24.69 (.11 ) 9.83 9.72 (.16 ) (.05 ) (.21 ) — 34.20 39.66 89,449 1.28 d (.36 ) d 61 August 31, 2016 21.18 .12 g 4.44 4.56 — (1.05 ) (1.05 ) — 24.69 21.92 30,322 1.28 d,f .52 d,f,g 62 August 31, 2015 22.00 (.05 ) .34 .29 — (1.11 ) (1.11 ) — 21.18 1.21 16,193 1.26 d (.22 ) d 111 August 31, 2014 16.67 (.04 ) 5.37 5.33 — — — — 22.00 31.97 10,313 1.29 d (.22 ) d 50 August 31, 2013 16.26 .01 .40 .41 — — — — e 16.67 2.52 8,355 1.36 d .05 d 54 Class B February 28, 2018 * * $32.06 (.20 ) 4.68 4.48 — (2.38 ) (2.38 ) — $34.16 14.41 * $8,581 .95 * (.60 )* 43 * August 31, 2017 23.20 (.31 ) 9.25 8.94 (.03 ) (.05 ) (.08 ) — 32.06 38.63 6,551 2.03 d (1.16 ) d 61 August 31, 2016 20.10 (.04 ) g 4.19 4.15 — (1.05 ) (1.05 ) — 23.20 21.04 4,098 2.03 d,f (.17 ) d,f,g 62 August 31, 2015 21.09 (.20 ) .32 .12 — (1.11 ) (1.11 ) — 20.10 .43 2,137 2.01 d (.98 ) d 111 August 31, 2014 16.10 (.18 ) 5.17 4.99 — — — — 21.09 30.99 1,781 2.04 d (.97 ) d 50 August 31, 2013 15.82 (.11 ) .39 .28 — — — — e 16.10 1.77 1,105 2.11 d (.70 ) d 54 Class C February 28, 2018 * * $32.05 (.20 ) 4.67 4.47 — (2.38 ) (2.38 ) — $34.14 14.39 * $27,944 .95 * (.60 )* 43 * August 31, 2017 23.19 (.31 ) 9.26 8.95 (.04 ) (.05 ) (.09 ) — 32.05 38.69 17,490 2.03 d (1.11 ) d 61 August 31, 2016 20.10 (.05 ) g 4.19 4.14 — (1.05 ) (1.05 ) — 23.19 20.98 5,503 2.03 d,f (.22 ) d,f,g 62 August 31, 2015 21.09 (.20 ) .32 .12 — (1.11 ) (1.11 ) — 20.10 .43 2,599 2.01 d (.98 ) d 111 August 31, 2014 16.09 (.18 ) 5.18 5.00 — — — — 21.09 31.08 1,801 2.04 d (.98 ) d 50 August 31, 2013 15.82 (.11 ) .38 .27 — — — — e 16.09 1.71 1,199 2.11 d (.70 ) d 54 Class M February 28, 2018 * * $32.79 (.17 ) 4.80 4.63 — (2.38 ) (2.38 ) — $35.04 14.55 * $2,701 .83 * (.48 )* 43 * August 31, 2017 23.70 (.23 ) 9.44 9.21 (.07 ) (.05 ) (.12 ) — 32.79 39.03 1,691 1.78 d (.81 ) d 61 August 31, 2016 20.47 (.01 ) g 4.29 4.28 — (1.05 ) (1.05 ) — 23.70 21.30 323 1.78 d,f (.03 ) d,f,g 62 August 31, 2015 21.40 (.16 ) .34 .18 — (1.11 ) (1.11 ) — 20.47 .72 188 1.76 d (.74 ) d 111 August 31, 2014 16.30 (.14 ) 5.24 5.10 — — — — 21.40 31.29 162 1.79 d (.72 ) d 50 August 31, 2013 15.98 (.07 ) .39 .32 — — — — e 16.30 2.00 92 1.86 d (.44 ) d 54 Class R February 28, 2018 * * $33.52 (.12 ) 4.90 4.78 — (2.38 ) (2.38 ) — $35.92 14.69 * $1,047 .70 * (.35 )* 43 * August 31, 2017 24.23 (.18 ) 9.65 9.47 (.13 ) (.05 ) (.18 ) — 33.52 39.34 577 1.53 d (.62 ) d 61 August 31, 2016 20.85 .05 g 4.38 4.43 — (1.05 ) (1.05 ) — 24.23 21.64 211 1.53 d,f .25 d,f,g 62 August 31, 2015 21.73 (.10 ) .33 .23 — (1.11 ) (1.11 ) — 20.85 .94 165 1.51 d (.45 ) d 111 August 31, 2014 16.50 (.09 ) 5.32 5.23 — — — — 21.73 31.70 50 1.54 d (.47 ) d 50 August 31, 2013 16.14 (.03 ) .38 .35 — — — .01 16.50 2.23 24 1.61 d (.17 ) d 54


Financial highlights cont.


* Not annualized. ** Unaudited. a Per share net investment income (loss) has been determined on the basis of the weighted average number of shares

outstanding during the period. b Total return assumes dividend reinvestment and does not reflect the effect of sales charges. c Includes amounts paid through expense offset and/or brokerage service arrangements, if any (Note 2). Also excludes

acquired fund fees and expenses, if any. d Reflects an involuntary contractual expense limitation in effect during the period. As a result of such limitation, the

expenses of each class reflect a reduction of the following amounts (Note 2):

Percentage of average net assetsAugust 31, 2017 0.04%August 31, 2016 0.26August 31, 2015 0.48August 31, 2014 0.74August 31, 2013 0.49

e Amount represents less than $0.01 per share. f Reflects a voluntary waiver of certain fund expenses in effect during the period. As a result of such waiver, the

expenses of each class reflect a reduction of less than 0.01% as a percentage of average net assets. g Reflects a dividend received by the fund from a single issuer which amounted to the following amounts:

Per share Percentage of average net assetsClass A $0.16 0.70%Class B 0.15 0.73Class C 0.15 0.70Class M 0.14 0.66Class R 0.16 0.73Class Y 0.28 1.20

h The net investment income ratio and per share amount shown for the period ending August 31, 2016 may not correspond with the expected class specific differences for the period due to the timing of subscriptions into the class.

INVESTMENT OPERATIONS LESS DISTRIBUTIONS RATIOS AND SUPPLEMENTAL DATA

Period ended

Net asset value,

beginning of period

Net investment income (loss ) a

Net realized and unrealized gain (loss) on investments

Total from investment operations

From net investment

income

From net realized

gain on investments

Total dis tri bu tions

Redemption fees

Net asset value, end of period

Total return at net asset value (% ) b

Net assets, end of period

(in thousands )

Ratio of expenses

to average net assets

(% ) c

Ratio of net investment

income (loss) to average

net assets (% )

Portfolio turnover

(% )

Class Y February 28, 2018 * * $34.90 (.04 ) 5.11 5.07 — (2.38 ) (2.38 ) — $37.59 14.94 * $99,812 .45 * (.10 )* 43 * August 31, 2017 25.16 (.03 ) 10.03 10.00 (.21 ) (.05 ) (.26 ) — 34.90 40.10 66,220 1.03 d (.11 ) d 61 August 31, 2016 21.52 .31 g,h 4.38 4.69 — (1.05 ) (1.05 ) — 25.16 22.19 18,142 1.03 d,f 1.35 d,f,g,h 62 August 31, 2015 22.29 — e .34 .34 — (1.11 ) (1.11 ) — 21.52 1.43 3,231 1.01 d .01 d 111 August 31, 2014 16.84 .01 5.44 5.45 — — — — 22.29 32.36 4,894 1.04 d .03 d 50 August 31, 2013 16.39 .05 .40 .45 — — — — e 16.84 2.75 1,794 1.11 d .31 d 54


Notes to financial statements 2/28/18 (Unaudited)

Within the following Notes to financial statements, references to “State Street” represent State Street Bank and Trust Company, references to “the SEC” represent the Securities and Exchange Commission, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC and references to “OTC”, if any, represent over-the-counter. Unless otherwise noted, the “reporting period” represents the period from September 1, 2017 through February 28, 2018.

Putnam Global Technology Fund (the fund) is a non- diversified series of Putnam Funds Trust (the Trust), a Massa-chusetts business trust registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The goal of the fund is to seek capital appreciation. The fund concentrates in the technology industries. The fund invests mainly in common stocks (growth or value stocks or both) of large and midsize companies worldwide that Putnam Management believes have favorable investment potential. Under normal circumstances, the fund invests at least 80% of the fund’s net assets in securities of companies in the technology industries. This policy may be changed after 60 days’ notice to shareholders. Potential invest-ments include companies that have, or will develop, products, processes or services that will provide advances and improvements through technology to consumers, enterprises and governments worldwide. The fund may purchase stocks of companies with stock prices that reflect a value lower than that which Putnam Management places on the company. Putnam Management may also consider other factors that it believes will cause the stock price to rise. Putnam Management may consider, among other factors, a company’s valuation, financial strength, growth potential, competitive position in its industry, projected future earnings, cash flows and dividends when deciding whether to buy or sell investments. The fund may also use derivatives, such as futures, options, certain foreign currency transactions, warrants and swap contracts, for both hedging and non-hedging purposes, and may engage in short sales of securities.

The fund offers class A, class B, class C, class M, class R and class Y shares. The fund registered class T shares in February 2017, however, as of the date of this report, class T shares had not commenced operations and are not available for purchase. Purchases of class B shares are closed to new and existing investors except by exchange from class B shares of another Putnam fund or through dividend and/or capital gains reinvestment. Class A and class M shares are sold with a maximum front-end sales charge of 5.75% and 3.50%, respectively. Class A shares generally are not subject to a contingent deferred sales charge, and class M, class R and class Y shares are not subject to a contingent deferred sales charge. Class B shares, which convert to class A shares after approximately eight years, are not subject to a front-end sales charge and are subject to a contingent deferred sales charge if those shares are redeemed within six years of purchase. Class C shares are subject to a one-year 1.00% contingent deferred sales charge and generally convert to class A shares after approximately ten years. Prior to April 1, 2018, class C shares did not convert to class A shares. Class R shares, which are not available to all investors, are sold at net asset value. The expenses for class A, class B, class C, class M and class R shares may differ based on the distribution fee of each class, which is identified in Note 2. Class Y shares, which are sold at net asset value, are generally subject to the same expenses as class A, class B, class C, class M and class R shares, but do not bear a distribution fee. Class Y shares are not available to all investors.

In the normal course of business, the fund enters into contracts that may include agreements to indemnify another party under given circumstances. The fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be, but have not yet been, made against the fund. However, the fund’s management team expects the risk of material loss to be remote.

The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, share-holder servicing agent and custodian, who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contrac-tual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.

Under the fund’s Agreement and Declaration of Trust, any claims asserted against or on behalf of the Putnam Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of Massachusetts.

Note 1: Significant accounting policiesThe following is a summary of significant accounting policies consistently followed by the fund in the prepa-ration of its financial statements. The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and the


reported amounts of increases and decreases in net assets from operations. Actual results could differ from those estimates. Subsequent events after the Statement of assets and liabilities date through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.

Investment income, realized and unrealized gains and losses and expenses of the fund are borne pro-rata based on the relative net assets of each class to the total net assets of the fund, except that each class bears expenses unique to that class (including the distribution fees applicable to such classes). Each class votes as a class only with respect to its own distribution plan or other matters on which a class vote is required by law or determined by the Trustees. If the fund were liquidated, shares of each class would receive their pro-rata share of the net assets of the fund. In addition, the Trustees declare separate dividends on each class of shares.

Security valuation Portfolio securities and other investments are valued using policies and procedures adopted by the Board of Trustees. The Trustees have formed a Pricing Committee to oversee the implementation of these procedures and have delegated responsibility for valuing the fund’s assets in accordance with these procedures to Putnam Management. Putnam Management has established an internal Valuation Committee that is respon-sible for making fair value determinations, evaluating the effectiveness of the pricing policies of the fund and reporting to the Pricing Committee.

Investments for which market quotations are readily available are valued at the last reported sales price on their principal exchange, or official closing price for certain markets, and are classified as Level 1 securities under Accounting Standards Codification 820 Fair Value Measurements and Disclosures (ASC 820). If no sales are reported, as in the case of some securities that are traded OTC, a security is valued at its last reported bid price and is generally categorized as a Level 2 security.

Investments in open-end investment companies (excluding exchange-traded funds), if any, which can be classi-fied as Level 1 or Level 2 securities, are valued based on their net asset value. The net asset value of such invest-ment companies equals the total value of their assets less their liabilities and divided by the number of their outstanding shares.

Market quotations are not considered to be readily available for certain debt obligations (including short-term investments with remaining maturities of 60 days or less) and other investments; such investments are valued on the basis of valuations furnished by an independent pricing service approved by the Trustees or dealers selected by Putnam Management. Such services or dealers determine valuations for normal institutional-size trading units of such securities using methods based on market transactions for comparable securities and various relation-ships, generally recognized by institutional traders, between securities (which consider such factors as security prices, yields, maturities and ratings). These securities will generally be categorized as Level 2.

Many securities markets and exchanges outside the U.S. close prior to the scheduled close of the New York Stock Exchange and therefore the closing prices for securities in such markets or on such exchanges may not fully reflect events that occur after such close but before the scheduled close of the New York Stock Exchange. Accord-ingly, on certain days, the fund will fair value certain foreign equity securities taking into account multiple factors including movements in the U.S. securities markets, currency valuations and comparisons to the valuation of American Depository Receipts, exchange-traded funds and futures contracts. The foreign equity securities, which would generally be classified as Level 1 securities, will be transferred to Level 2 of the fair value hierarchy when they are valued at fair value. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the fund to a significant extent. At the close of the reporting period, fair value pricing was used for certain foreign securities in the portfolio. Securities quoted in foreign currencies, if any, are translated into U.S. dollars at the current exchange rate.

To the extent a pricing service or dealer is unable to value a security or provides a valuation that Putnam Manage-ment does not believe accurately reflects the security’s fair value, the security will be valued at fair value by Putnam Management in accordance with policies and procedures approved by the Trustees. Certain invest-ments, including certain restricted and illiquid securities and derivatives, are also valued at fair value following procedures approved by the Trustees. These valuations consider such factors as significant market or specific security events such as interest rate or credit quality changes, various relationships with other securities, discount rates, U.S. Treasury, U.S. swap and credit yields, index levels, convexity exposures, recovery rates, sales and other multiples and resale restrictions. These securities are classified as Level 2 or as Level 3 depending on the priority of the significant inputs.

To assess the continuing appropriateness of fair valuations, the Valuation Committee reviews and affirms the reasonableness of such valuations on a regular basis after considering all relevant information that is reasonably available. Such valuations and procedures are reviewed periodically by the Trustees. The fair value of securities


is generally determined as the amount that the fund could reasonably expect to realize from an orderly disposi-tion of such securities over a reasonable period of time. By its nature, a fair value price is a good faith estimate of the value of a security in a current sale and does not reflect an actual market price, which may be different by a material amount.

Security transactions and related investment income Security transactions are recorded on the trade date (the date the order to buy or sell is executed). Gains or losses on securities sold are determined on the identified cost basis.

Interest income, net of any applicable withholding taxes, is recorded on the accrual basis. Dividend income, net of any applicable withholding taxes, is recognized on the ex-dividend date except that certain dividends from foreign securities, if any, are recognized as soon as the fund is informed of the ex-dividend date. Non-cash divi-dends, if any, are recorded at the fair value of the securities received. Dividends representing a return of capital or capital gains, if any, are reflected as a reduction of cost and/or as a realized gain. All premiums/discounts are amortized/accreted on a yield-to-maturity basis.

Securities purchased or sold on a delayed delivery basis may be settled at a future date beyond customary settle-ment time; interest income is accrued based on the terms of the securities. Losses may arise due to changes in the fair value of the underlying securities or if the counterparty does not perform under the contract.

Foreign currency translation The accounting records of the fund are maintained in U.S. dollars. The fair value of foreign securities, currency holdings, and other assets and liabilities is recorded in the books and records of the fund after translation to U.S. dollars based on the exchange rates on that day. The cost of each security is deter-mined using historical exchange rates. Income and withholding taxes are translated at prevailing exchange rates when earned or incurred. The fund does not isolate that portion of realized or unrealized gains or losses resulting from changes in the foreign exchange rate on investments from fluctuations arising from changes in the market prices of the securities. Such gains and losses are included with the net realized and unrealized gain or loss on investments. Net realized gains and losses on foreign currency transactions represent net realized exchange gains or losses on disposition of foreign currencies, currency gains and losses realized between the trade and settlement dates on securities transactions and the difference between the amount of investment income and foreign withholding taxes recorded on the fund’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized appreciation and depreciation of assets and liabilities in foreign currencies arise from changes in the value of assets and liabilities other than investments at the period end, resulting from changes in the exchange rate.

Forward currency contracts The fund buys and sells forward currency contracts, which are agreements between two parties to buy and sell currencies at a set price on a future date. These contracts are used to hedge foreign exchange risk.

The U.S. dollar value of forward currency contracts is determined using current forward currency exchange rates supplied by a quotation service. The fair value of the contract will fluctuate with changes in currency exchange rates. The contract is marked to market daily and the change in fair value is recorded as an unrealized gain or loss. The fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed when the contract matures or by delivery of the currency. The fund could be exposed to risk if the value of the currency changes unfavorably, if the counterparties to the contracts are unable to meet the terms of their contracts or if the fund is unable to enter into a closing position. Risks may exceed amounts recognized on the Statement of assets and liabilities.

Forward currency contracts outstanding at period end, if any, are listed after the fund’s portfolio.

Master agreements The fund is a party to ISDA (International Swaps and Derivatives Association, Inc.) Master Agreements (Master Agreements) with certain counterparties that govern OTC derivative and foreign exchange contracts entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties’ general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agree-ments, collateral posted to the fund is held in a segregated account by the fund’s custodian and, with respect to those amounts which can be sold or repledged, is presented in the fund’s portfolio.

Collateral pledged by the fund is segregated by the fund’s custodian and identified in the fund’s portfolio. Collat-eral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other secu-rities as agreed to by the fund and the applicable counterparty. Collateral requirements are determined based on the fund’s net position with each counterparty.


Termination events applicable to the fund may occur upon a decline in the fund’s net assets below a speci-fied threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term and short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the fund’s counterparties to elect early termination could impact the fund’s future derivative activity.

At the close of the reporting period, the fund had a net liability position of $179,697 on open derivative contracts subject to the Master Agreements. Collateral posted by the fund at period end for these agreements totaled $243,390 and may include amounts related to unsettled agreements.

Securities lending The fund may lend securities, through its agent, to qualified borrowers in order to earn addi-tional income. The loans are collateralized by cash in an amount at least equal to the fair value of the securities loaned. The fair value of securities loaned is determined daily and any additional required collateral is allocated to the fund on the next business day. The remaining maturities of the securities lending transactions are consid-ered overnight and continuous. The risk of borrower default will be borne by the fund’s agent; the fund will bear the risk of loss with respect to the investment of the cash collateral. Income from securities lending, net of expenses, is included in investment income on the Statement of operations. Cash collateral is invested in Putnam Cash Collateral Pool, LLC, a limited liability company managed by an affiliate of Putnam Management. Invest-ments in Putnam Cash Collateral Pool, LLC are valued at its closing net asset value each business day. There are no management fees charged to Putnam Cash Collateral Pool, LLC. At the close of the reporting period, the fund received cash collateral of $24,580,400 and the value of securities loaned amounted to $23,918,320.

Interfund lending The fund, along with other Putnam funds, may participate in an interfund lending program pursuant to an exemptive order issued by the SEC. This program allows the fund to borrow from or lend to other Putnam funds that permit such transactions. Interfund lending transactions are subject to each fund’s investment policies and borrowing and lending limits. Interest earned or paid on the interfund lending transac-tion will be based on the average of certain current market rates. During the reporting period, the fund did not utilize the program.

Lines of credit The fund participates, along with other Putnam funds, in a $317.5 million unsecured committed line of credit and a $235.5 million unsecured uncommitted line of credit, both provided by State Street. Borrow-ings may be made for temporary or emergency purposes, including the funding of shareholder redemption requests and trade settlements. Interest is charged to the fund based on the fund’s borrowing at a rate equal to 1.25% plus the higher of (1) the Federal Funds rate and (2) the overnight LIBOR for the committed line of credit and the Federal Funds rate plus 1.30% for the uncommitted line of credit. A closing fee equal to 0.04% of the committed line of credit plus a $25,000 flat fee and 0.04% of the uncommitted line of credit has been paid by the participating funds. In addition, a commitment fee of 0.21% per annum on any unutilized portion of the committed line of credit is allocated to the participating funds based on their relative net assets and paid quarterly. During the reporting period, the fund had no borrowings against these arrangements.

Federal taxes It is the policy of the fund to distribute all of its taxable income within the prescribed time period and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended (the Code), appli-cable to regulated investment companies. It is also the intention of the fund to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Code.

The fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (ASC 740). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The fund did not have a liability to record for any unrecognized tax benefits in the accompanying financial statements. No provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held nor for excise tax on income and capital gains. Each of the fund’s federal tax returns for the prior three fiscal years remains subject to examination by the Internal Revenue Service.

The fund may also be subject to taxes imposed by governments of countries in which it invests. Such taxes are generally based on either income or gains earned or repatriated. The fund accrues and applies such taxes to net investment income, net realized gains and net unrealized gains as income and/or capital gains are earned. In some cases, the fund may be entitled to reclaim all or a portion of such taxes, and such reclaim amounts, if any, are reflected as an asset on the fund’s books. In many cases, however, the fund may not receive such amounts for an extended period of time, depending on the country of investment.


The aggregate identified cost on a tax basis is $265,195,763, resulting in gross unrealized appreciation and depreciation of $61,630,757 and $5,169,519, respectively, or net unrealized appreciation of $56,461,238.

Distributions to shareholders Distributions to shareholders from net investment income are recorded by the fund on the ex-dividend date. Distributions from capital gains, if any, are recorded on the ex-dividend date and paid at least annually. The amount and character of income and gains to be distributed are determined in accor-dance with income tax regulations, which may differ from generally accepted accounting principles. Dividend sources are estimated at the time of declaration. Actual results may vary. Any non-taxable return of capital cannot be determined until final tax calculations are completed after the end of the fund’s fiscal year. Reclassifications are made to the fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryovers) under income tax regulations.

Expenses of the Trust Expenses directly charged or attributable to any fund will be paid from the assets of that fund. Generally, expenses of the Trust will be allocated among and charged to the assets of each fund on a basis that the Trustees deem fair and equitable, which may be based on the relative assets of each fund or the nature of the services performed and relative applicability to each fund.

Note 2: Management fee, administrative services and other transactionsThe fund pays Putnam Management a management fee (based on the fund’s average net assets and computed and paid monthly) at annual rates that may vary based on the average of the aggregate net assets of all open-end mutual funds sponsored by Putnam Management (excluding net assets of funds that are invested in, or that are invested in by, other Putnam funds to the extent necessary to avoid “double counting” of those assets). Such annual rates may vary as follows:

0.780 % of the first $5 billion,

0.730 % of the next $5 billion,





0.550 % of the next $100 billion and

0.545 % of any excess thereafter.

For the reporting period, the management fee represented an effective rate (excluding the impact from any expense waivers in effect) of 0.309% of the fund’s average net assets.

Putnam Management has contractually agreed, through December 30, 2018, to waive fees or reimburse the fund’s expenses to the extent necessary to limit the cumulative expenses of the fund, exclusive of brokerage, interest, taxes, investment-related expenses, extraordinary expenses, acquired fund fees and expenses and payments under the fund’s investor servicing contract, investment management contract and distribution plans, on a fiscal year-to-date basis to an annual rate of 0.20% of the fund’s average net assets over such fiscal year-to-date period. During the reporting period, the fund’s expenses were not reduced as a result of this limit.

Putnam Investments Limited (PIL), an affiliate of Putnam Management, is authorized by the Trustees to manage a separate portion of the assets of the fund as determined by Putnam Management from time to time. PIL did not manage any portion of the assets of the fund during the reporting period. If Putnam Management were to engage the services of PIL, Putnam Management would pay a quarterly sub-management fee to PIL for its services at an annual rate of 0.35% of the average net assets of the portion of the fund managed by PIL.

The Putnam Advisory Company, LLC (PAC), an affiliate of Putnam Management, is authorized by the Trustees to manage a separate portion of the assets of the fund, as designated from time to time by Putnam Management or PIL. Putnam Management or PIL, as applicable, pays a quarterly sub-advisory fee to PAC for its services at the annual rate of 0.35% of the average net assets of the portion of the fund’s assets for which PAC is engaged as sub-adviser.

The fund reimburses Putnam Management an allocated amount for the compensation and related expenses of certain officers of the fund and their staff who provide administrative services to the fund. The aggregate amount of all such reimbursements is determined annually by the Trustees.

Custodial functions for the fund’s assets are provided by State Street. Custody fees are based on the fund’s asset level, the number of its security holdings and transaction volumes.

Putnam Investor Services, Inc., an affiliate of Putnam Management, provides investor servicing agent func-tions to the fund. Putnam Investor Services, Inc. received fees for investor servicing for class A, class B, class C, class M, class R and class Y shares that included (1) a per account fee for each direct and underlying non-defined


contribution account (“retail account”) of the fund; (2) a specified rate of the fund’s assets attributable to defined contribution plan accounts; and (3) a specified rate based on the average net assets in retail accounts. Putnam Investor Services, Inc. has agreed that the aggregate investor servicing fees for each fund’s retail and defined contribution accounts for these share classes will not exceed an annual rate of 0.25% of the fund’s average assets attributable to such accounts.

During the reporting period, the expenses for each class of shares related to investor servicing fees were as follows:

Class A $117,771

Class B 7,084

Class C 20,783

Class M 1,991

Class R 680

Class Y 77,466

Total $225,775

The fund has entered into expense offset arrangements with Putnam Investor Services, Inc. and State Street whereby Putnam Investor Services, Inc.’s and State Street’s fees are reduced by credits allowed on cash balances. The fund also reduced expenses through brokerage/service arrangements. For the reporting period, the fund’s expenses were reduced by $1,136 under the expense offset arrangements and by $619 under the brokerage/service arrangements.

Each Independent Trustee of the fund receives an annual Trustee fee, of which $187, as a quarterly retainer, has been allocated to the fund, and an additional fee for each Trustees meeting attended. Trustees also are reimbursed for expenses they incur relating to their services as Trustees.

The fund has adopted a Trustee Fee Deferral Plan (the Deferral Plan) which allows the Trustees to defer the receipt of all or a portion of Trustees fees payable on or after July 1, 1995. The deferred fees remain invested in certain Putnam funds until distribution in accordance with the Deferral Plan.

The fund has adopted an unfunded noncontributory defined benefit pension plan (the Pension Plan) covering all Trustees of the fund who have served as a Trustee for at least five years and were first elected prior to 2004. Benefits under the Pension Plan are equal to 50% of the Trustee’s average annual attendance and retainer fees for the three years ended December 31, 2005. The retirement benefit is payable during a Trustee’s lifetime, beginning the year following retirement, for the number of years of service through December 31, 2006. Pension expense for the fund is included in Trustee compensation and expenses in the Statement of operations. Accrued pension liability is included in Payable for Trustee compensation and expenses in the Statement of assets and liabilities. The Trustees have terminated the Pension Plan with respect to any Trustee first elected after 2003.

The fund has adopted distribution plans (the Plans) with respect to the following share classes pursuant to Rule 12b–1 under the Investment Company Act of 1940. The purpose of the Plans is to compensate Putnam Retail Management Limited Partnership, an indirect wholly-owned subsidiary of Putnam Investments, LLC, for services provided and expenses incurred in distributing shares of the fund. The Plans provide payments by the fund to Putnam Retail Management Limited Partnership at an annual rate of up to the following amounts (“Maximum %”) of the average net assets attributable to each class. The Trustees have approved payment by the fund at the following annual rate (“Approved %”) of the average net assets attributable to each class. During the reporting period, the class-specific expenses related to distribution fees were as follows:

Maximum % Approved % Amount

Class A 0.35 % 0.25 % $156,588

Class B 1.00 % 1.00 % 37,885

Class C 1.00 % 1.00 % 110,727

Class M 1.00 % 0.75 % 7,956

Class R 1.00 % 0.50 % 1,801

Total $314,957

For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received net commissions of $75,215 and $1,817 from the sale of class A and class M shares, respectively, and received $840 and $267 in contingent deferred sales charges from redemptions of class B and class C shares, respectively.


A deferred sales charge of up to 1.00% is assessed on certain redemptions of class A shares. For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received no monies on class A redemptions.

Note 3: Purchases and sales of securitiesDuring the reporting period, the cost of purchases and the proceeds from sales, excluding short-term investments, were as follows:

Cost of purchases Proceeds from sales

Investments in securities (Long-term ) $182,294,068 $99,577,865

U.S. government securities (Long-term ) — —

Total $182,294,068 $99,577,865

The fund may purchase or sell investments from or to other Putnam funds in the ordinary course of business, which can reduce the fund’s transaction costs, at prices determined in accordance with SEC requirements and policies approved by the Trustees. During the reporting period, purchases or sales of long-term securities from or to other Putnam funds, if any, did not represent more than 5% of the fund’s total cost of purchases and/or total proceeds from sales.

Note 4: Capital sharesAt the close of the reporting period, there were an unlimited number of shares of beneficial interest authorized. Transactions in capital shares were as follows:

SIX MONTHS ENDED 2/28/18 YEAR ENDED 8/31/17

Class A Shares Amount Shares Amount

Shares sold 2,369,502 $85,548,611 2,047,807 $60,876,316

Shares issued in connection with reinvestment of distributions 239,045 8,270,964 11,295 285,524

2,608,547 93,819,575 2,059,102 61,161,840

Shares repurchased (842,105 ) (30,259,615 ) (672,323 ) (20,063,631 )

Net increase 1,766,442 $63,559,960 1,386,779 $41,098,209


Class B Shares Amount Shares Amount

Shares sold 44,616 $1,532,057 78,670 $2,005,161

Shares issued in connection with reinvestment of distributions 16,742 539,255 622 14,813

61,358 2,071,312 79,292 2,019,974

Shares repurchased (14,447 ) (485,339 ) (51,661 ) (1,403,397 )

Net increase 46,911 $1,585,973 27,631 $616,577


Class C Shares Amount Shares Amount

Shares sold 278,066 $9,358,607 372,256 $10,266,716


326,858 10,929,217 373,292 10,291,375


Net increase 272,717 $9,131,698 308,466 $8,495,848



Class M Shares Amount Shares Amount

Shares sold 24,291 $833,151 42,523 $1,201,224


28,626 976,289 42,601 1,203,111

Shares repurchased (3,100 ) (105,834 ) (4,675 ) (121,418 )

Net increase 25,526 $870,455 37,926 $1,081,693


Class R Shares Amount Shares Amount

Shares sold 11,648 $415,513 15,020 $407,907


12,867 456,778 15,086 409,553

Shares repurchased (926 ) (32,566 ) (6,597 ) (179,657 )

Net increase 11,941 $424,212 8,489 $229,896


Class Y Shares Amount Shares Amount

Shares sold 1,146,451 $42,403,793 1,477,902 $43,799,297


1,293,582 47,609,296 1,489,197 44,090,149


Net increase 757,391 $27,903,187 1,176,693 $35,021,296

Note 5: Affiliated transactionsTransactions during the reporting period with any company which is under common ownership or control were as follows:

Name of affiliateFair value as

of 9/1/17Purchase

costSale

proceedsInvestment

income

Shares outstanding

and fair value as

of 2/28/18

Short-term investments

Putnam Cash Collateral Pool, LLC * $13,132,370 $94,465,830 $83,017,800 $116,316 $24,580,400

Putnam Short Term Investment Fund * * 10,893,828 90,414,309 94,000,923 55,434 7,307,214

Total Short-term investments $24,026,198 $184,880,139 $177,018,723 $171,750 $31,887,614

* No management fees are charged to Putnam Cash Collateral Pool, LLC (Note 1). Investment income shown is included in securities lending income on the Statement of operations. There were no realized or unrealized gains or losses during the period.

** Management fees charged to Putnam Short Term Investment Fund have been waived by Putnam Management. There were no realized or unrealized gains or losses during the period.


Note 6: Market, credit and other risksIn the normal course of business, the fund trades financial instruments and enters into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the contracting party to the transaction to perform (credit risk). The fund may be exposed to additional credit risk that an institution or other entity with which the fund has unsettled or open transactions will default. Investments in foreign securi-ties involve certain risks, including those related to economic instability, unfavorable political developments, and currency fluctuations. The fund concentrates a majority of its investments in the technology sector, which involves more risk than a fund that invests more broadly.

Note 7: Summary of derivative activityThe volume of activity for the reporting period for any derivative type that was held during the period is listed below and was based on an average of the holdings at the end of each fiscal quarter:

Forward currency contracts (contract amount ) $38,900,000

Warrants (number of warrants ) 290,000

The following is a summary of the fair value of derivative instruments as of the close of the reporting period:

Fair value of derivative instruments as of the close of the reporting periodASSET DERIVATIVES LIABILITY DERIVATIVES

Derivatives not accounted for as hedging instruments under ASC 815

Statement of assets and

liabilities location Fair value

Statement of assets and

liabilities location Fair value

Foreign exchange contracts Receivables $238,871 Payables $321,015

Equity contracts Investments 4,571,636 Payables —

Total $4,810,507 $321,015

The following is a summary of realized and change in unrealized gains or losses of derivative instruments in the Statement of operations for the reporting period (Note 1):

Amount of realized gain or (loss ) on derivatives recognized in net gain or (loss ) on investmentsDerivatives not accounted for as hedging instruments under ASC 815

Forward currency contracts Total

Foreign exchange contracts $(290,155 ) $(290,155 )

Total $(290,155 ) $(290,155 )

Change in unrealized appreciation or (depreciation ) on derivatives recognized in net gain or (loss ) on investmentsDerivatives not accounted for as hedging instruments under ASC 815 Warrants

Forward currency contracts Total

Foreign exchange contracts $— $(211,104 ) $(211,104 )

Equity contracts 107,904 — 107,904

Total $107,904 $(211,104 ) $(103,200 )


This page left blank intentionally.


Note 8: Offsetting of financial and derivative assets and liabilitiesThe following table summarizes any derivatives, repurchase agreements and reverse repurchase agreements, at the end of the reporting period, that are subject to an enforceable master netting agreement or similar agree-ment. For securities lending transactions or borrowing transactions associated with securities sold short, if any, see Note 1. For financial reporting purposes, the fund does not offset financial assets and financial liabilities that are subject to the master netting agreements in the Statement of assets and liabilities.

Bank

of

Amer

ica N

.A.

Barc

lays

Ban

k PL

C

Citib

ank,

N.A

.

Cred

it Su

isse

Inte

rnat

iona

l

Gold

man

Sa

chs

Inte

rnat

iona

l

HSBC

Ban

k US

A, N

atio

nal

Asso

ciat

ion

JPM

orga

n Ch

ase B

ank —

Lo

ndon

JPM

orga

n Ch

ase B

ank

N.A.

Stat

e Str

eet

Bank

and

Trus

t Co.

Tota

l

Assets:

Forward currency contracts# $— $— $— $1,890 $12,466 $18,469 $— $119,239 $86,807 $238,871

Total Assets $— $— $— $1,890 $12,466 $18,469 $— $119,239 $86,807 $238,871

Liabilities:

Forward currency contracts# 60,389 10 53,459 — 22,651 — — 42,045 142,461 321,015

Total Liabilities $60,389 $10 $53,459 $— $22,651 $— $— $42,045 $142,461 $321,015

Total Financial and Derivative Net Assets $(60,389) $(10) $(53,459) $1,890 $(10,185) $18,469 $— $77,194 $(55,654) $(82,144)

Total collateral received (pledged)†## $(60,389) $— $(53,459) $— $(10,185) $— $— $— $—

Net amount $— $(10) $— $1,890 $— $18,469 $— $77,194 $(55,654)

Controlled collateral received (including TBA commitments)** $— $— $— $— $— $— $— $— $— $—

Uncontrolled collateral received $— $— $— $— $— $— $— $— $— $—

Collateral (pledged) (including TBA commitments)** $(110,656) $— $(120,758) $— $(11,976) $— $— $— $— $(243,390)

** Included with Investments in securities on the Statement of assets and liabilities.

† Additional collateral may be required from certain brokers based on individual agreements.

# Covered by master netting agreement (Note 1). ##Any over-collateralization of total financial and derivative net assets is not shown. Collateral may include amounts

related to unsettled agreements.


Putnam family of fundsThe following is a list of Putnam’s open-end mutual funds offered to the public. Investors should carefully consider the investment objective, risks, charges, and expenses of a fund before investing. For a prospectus, or a summary prospectus if available, containing this and other information for any Putnam fund or product, contact your financial advisor or call Putnam Investor Services at 1-800-225-1581. Please read the prospectus carefully before investing.

BlendCapital Opportunities FundCapital Spectrum FundEmerging Markets Equity FundEquity Spectrum FundEurope Equity FundGlobal Equity FundInternational Capital Opportunities FundInternational Equity FundInvestors FundLow Volatility Equity FundMulti-Cap Core FundResearch Fund

Global SectorGlobal Consumer FundGlobal Financials FundGlobal Health Care FundGlobal Industrials FundGlobal Natural Resources FundGlobal Sector FundGlobal Technology FundGlobal Telecommunications FundGlobal Utilities Fund

GrowthGrowth Opportunities FundInternational Growth FundMulti-Cap Growth FundSmall Cap Growth Fund

ValueConvertible Securities FundEquity Income FundInternational Value Fund Multi-Cap Value FundSmall Cap Value Fund

IncomeAmerican Government Income FundDiversified Income TrustEmerging Markets Income FundFloating Rate Income FundGlobal Income TrustGovernment Money Market Fund*

High Yield FundIncome FundMoney Market Fund†

Short Duration Income FundU.S. Government Income Trust

Tax-free IncomeAMT-Free Municipal FundIntermediate-Term Municipal Income FundShort-Term Municipal Income FundTax Exempt Income FundTax-Free High Yield Fund

State tax-free income funds‡: California, Massachusetts, Minnesota, New Jersey, New York, Ohio, and Pennsylvania.


Absolute ReturnAbsolute Return 100 Fund®Absolute Return 300 Fund®Absolute Return 500 Fund®Absolute Return 700 Fund®

Putnam PanAgora**Putnam PanAgora Managed Futures StrategyPutnam PanAgora Market Neutral FundPutnam PanAgora Risk Parity Fund

Asset AllocationGeorge Putnam Balanced Fund

Dynamic Asset Allocation Balanced FundDynamic Asset Allocation Conservative FundDynamic Asset Allocation Growth FundDynamic Risk Allocation Fund

Retirement Income Fund Lifestyle 1

RetirementReady® 2060 Fund RetirementReady® 2055 FundRetirementReady® 2050 FundRetirementReady® 2045 FundRetirementReady® 2040 FundRetirementReady® 2035 FundRetirementReady® 2030 FundRetirementReady® 2025 FundRetirementReady® 2020 Fund

* You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund’s sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.

† You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The fund may impose a fee upon sale of your shares or may temporarily suspend your ability to sell shares if the fund’s liquidity falls below required minimums because of market conditions or other factors. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund’s sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.

‡ Not available in all states.

** Sub-advised by PanAgora Asset Management.Check your account balances and the most recent month-end performance in the Individual Investors section at putnam.com.



Services for shareholders

Investor services

Systematic investment plan Tell us how much you wish to invest regularly — weekly, semimonthly, or monthly — and the amount you choose will be transferred automatically from your checking or savings account. There’s no additional fee for this service, and you can suspend it at any time. This plan may be a great way to save for college expenses or to plan for your retirement.

Please note that regular investing does not guarantee a profit or protect against loss in a declining market. Before arranging a system-atic investment plan, consider your financial ability to continue making purchases in periods when prices are low.

Systematic exchange You can make regular transfers from one Putnam fund to another Putnam fund. There are no additional fees for this service, and you can cancel or change your options at any time.

Dividends PLUS You can choose to have the dividend distributions from one of your Putnam funds automatically reinvested in another Putnam fund at no additional charge.

Free exchange privilege You can exchange money between Putnam funds free of charge, as long as they are the same class of shares. A signature guarantee is required if you are exchanging more than $500,000. The fund reserves the right to revise or terminate the exchange privilege.

Reinstatement privilege If you’ve sold Putnam shares or received a check for a divi-dend or capital gain, you may reinvest the proceeds with Putnam within 90 days of the

transaction and they will be reinvested at the fund’s current net asset value — with no sales charge. However, reinstatement of class B shares may have special tax consequences. Ask your financial or tax representative for details.

Check-writing service You have ready access to many Putnam accounts. It’s as simple as writing a check, and there are no special fees or service charges. For more information about the check-writing service, call Putnam or visit our website.

Dollar cost averaging When you’re investing for long-term goals, it’s time, not timing, that counts. Investing on a systematic basis is a better strategy than trying to figure out when the markets will go up or down. This means investing the same amount of money regularly over a long period. This method of investing is called dollar cost averaging. When a fund’s share price declines, your investment dollars buy more shares at lower prices. When it increases, they buy fewer shares. Over time, you will pay a lower average price per share.

For more information

Visit the Individual Investors section at putnam.com A secure section of our website contains complete information on your account, including balances and transac-tions, updated daily. You may also conduct transactions, such as exchanges, additional investments, and address changes. Log on today to get your password.

Call us toll free at 1-800-225-1581 Ask a helpful Putnam representative or your financial advisor for details about any of these or other services, or see your prospectus.


Fund informationFounded over 80 years ago, Putnam Investments was built around the concept that a balance between risk and reward is the hallmark of a well-rounded financial program. We manage over 100 funds across income, value, blend, growth, asset allocation, absolute return, and global sector categories.

Investment ManagerPutnam Investment Management, LLC One Post Office Square Boston, MA 02109

Investment Sub-AdvisorsPutnam Investments Limited 16 St James’s Street London, England SW1A 1ER

The Putnam Advisory Company, LLC One Post Office Square Boston, MA 02109

Marketing ServicesPutnam Retail Management One Post Office Square Boston, MA 02109

CustodianState Street Bank and Trust Company

Legal CounselRopes & Gray LLP

TrusteesJameson A. Baxter, Chair Kenneth R. Leibler, Vice Chair Liaquat Ahamed Ravi Akhoury Barbara M. Baumann Katinka Domotorffy Catharine Bond Hill Paul L. Joskow Robert E. Patterson George Putnam, III Robert L. Reynolds Manoj P. Singh

OfficersRobert L. Reynolds President

Jonathan S. Horwitz Executive Vice President, Principal Executive Officer, and Compliance Liaison

Robert T. Burns Vice President and Chief Legal Officer

James F. Clark Vice President and Chief Compliance Officer

Michael J. Higgins Vice President, Treasurer, and Clerk

Janet C. Smith Vice President, Principal Financial Officer, Principal Accounting Officer, and Assistant Treasurer

Susan G. Malloy Vice President and Assistant Treasurer

Mark C. Trenchard Vice President and BSA Compliance Officer

Nancy E. Florek Vice President, Director of Proxy Voting and Corporate Governance, Assistant Clerk, and Assistant Treasurer

Denere P. Poulack Assistant Vice President, Assistant Clerk, and Assistant Treasurer

This report is for the information of shareholders of Putnam Global Technology Fund. It may also be used as sales literature when preceded or accompanied by the current prospectus, the most recent copy of Putnam’s Quarterly Performance Summary, and Putnam’s Quarterly Ranking Summary. For more recent performance, please visit putnam.com. Investors should carefully consider the investment objectives, risks, charges, and expenses of a fund, which are described in its prospectus. For this and other information or to request a prospectus or summary prospectus, call 1-800-225-1581 toll free. Please read the prospectus carefully before investing. The fund’s Statement of Additional Information contains additional information about the fund’s Trustees and is available without charge upon request by calling 1-800-225-1581.


SA72

2 31

0282

4/

18

Elec

tron

ic se

rvic

e re

ques

ted

Go p

aper

less

: Log

on

to p

utna

m.c

om o

r sca

n th

is c

ode

to u

pdat

e yo

ur m

ailin

g op

tions

.

One

Pos

t Offi

ce S

quar

e

Bost

on, M

A 02

109

1-80

0-22

5-15

81pu

tnam

.com

PRSR

T ST

D

U.S

. PO

STAG

E PA

ID

BRO

CKTO

N, M

A

PERM

IT N

O. 6

00

http://www.putnam.com/?ref=722.pdf



Documents

Global Technology Fund Semi-Annual Report · before sales charge Putnam Global Technology Fund ... synchronized global growth recovery, led by ... Global Sector Global Technology