Fidelity Variable Insurance Products: FundsManager 20%, 50%, 60%, 70%, 85% Portfolio. Semi-Annual Report June 30, 2016

Transcription

1 Fidelity Variable Insurance Products: FundsManager 20%, 50%, 60%, 70%, 85% Portfolio Semi-Annual Report June 30, 2016

2 Contents VIP FundsManager 20% Portfolio 3 Investment Summary 4 Investments 8 Financial Statements VIP FundsManager 50% Portfolio 13 Investment Summary 14 Investments 18 Financial Statements VIP FundsManager 60% Portfolio 23 Investment Summary 24 Investments 28 Financial Statements VIP FundsManager 70% Portfolio 33 Investment Summary 34 Investments 37 Financial Statements VIP FundsManager 85% Portfolio 42 Investment Summary Notes to Financial Statements 51 Shareholder Expense Example Investments 46 Financial Statements To view a fund s proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit or visit the Securities and Exchange Commission s (SEC) web site at You may also call to request a free copy of the proxy voting guidelines. Fidelity Variable Insurance Products are separate account options which are purchased through a variable insurance contract. Standard & Poor s, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation. Other third-party marks appearing herein are the property of their respective owners. All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company FMR LLC. All rights reserved. This report and the financial statements contained herein are submitted for the general information of the shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless preceded or accompanied by an effective prospectus. A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC s web site at A fund s Forms N-Q may be reviewed and copied at the SEC s Public Reference Room in Washington, DC. Information regarding the operation of the SEC s Public Reference Room may be obtained by calling SEC For a complete list of a fund s portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity s web site at or as applicable. NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE Neither the Funds nor Fidelity Distributors Corporation is a bank. Semi-Annual Report

3 VIP FundsManager 20% Portfolio Investment Summary (Unaudited) The information in the following tables is based on the direct investments of the Fund. Top Holdings as of June 30, 2016 % of fund s net assets % of fund s net assets 6 months ago Fidelity U.S. Bond Index Fund Institutional Premium Class Fidelity Investments Money Market Treasury Portfolio Institutional Class 0.23% Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% Fidelity Inflation-Protected Bond Index Fund Institutional Class Fidelity Floating Rate High Income Fund Fidelity Overseas Fund Fidelity Technology Portfolio Fidelity Consumer Staples Portfolio Fidelity Long-Term Treasury Bond Index Fund Premium Class Fidelity Medical Equipment and Systems Portfolio Asset Allocation (% of fund s net assets) As of June 30, 2016 Domestic Equity Funds 15.4% International Equity Funds 6.1% Fixed-Income Funds 49.8% Money Market Funds 28.7% As of December 31, 2015 Domestic Equity Funds 15.8% International Equity Funds 8.8% Fixed-Income Funds 47.8% Money Market Funds 27.6% 3 Semi-Annual Report

4 VIP FundsManager 20% Portfolio Investments June 30, 2016 (Unaudited) Showing Percentage of Net Assets Equity Funds 21.5% Shares Value Domestic Equity Funds 15.4% Fidelity Banking Portfolio (a) 193,731 $ 4,572,043 Fidelity Blue Chip Growth Fund (a) 1,336 87,108 Fidelity Chemicals Portfolio (a) 22,680 3,146,681 Fidelity Construction and Housing Portfolio (a) 72,590 4,334,322 Fidelity Consumer Discretionary Portfolio (a) 214,205 7,302,261 Fidelity Consumer Staples Portfolio (a) 103,212 10,175,696 Fidelity Defense and Aerospace Portfolio (a) 29,755 3,545,852 Fidelity Dividend Growth Fund (a) ,640 Fidelity Electronics Portfolio (a) 51,262 3,880,568 Fidelity Energy Portfolio (a) 158,618 6,474,802 Fidelity Equity Dividend Income Fund (a) 66,034 1,714,247 Fidelity Extended Market Index Fund Premium Class (a) ,706 Fidelity Financial Services Portfolio (a) 68,382 5,590,213 Fidelity Global Commodity Stock Fund (a) 118,129 1,208,456 Fidelity Gold Portfolio (a) 7, ,706 Fidelity Health Care Portfolio (a) 8,755 1,686,002 Fidelity Health Care Services Portfolio (a) 22,617 1,947,733 Fidelity Industrial Equipment Portfolio (a) 60,368 2,308,484 Fidelity Industrials Portfolio (a) 157,112 4,774,628 Fidelity Insurance Portfolio (a) 82,040 5,593,517 Fidelity IT Services Portfolio (a) 54,189 2,121,498 Fidelity Low Priced Stock Fund (a) 1,735 83,146 Fidelity Materials Portfolio (a) 2, ,124 Fidelity Medical Equipment and Systems Portfolio (a) 214,481 8,579,244 Fidelity Natural Gas Portfolio (a) 155 3,861 Fidelity OTC Portfolio (a) 1, ,676 Fidelity Pharmaceuticals Portfolio (a) 25, ,172 Fidelity Real Estate Investment Portfolio (a) 104,140 4,734,208 Fidelity Retailing Portfolio (a) 24,584 2,586,743 Fidelity Series Commodity Strategy Fund (a)(b) 300,912 1,661,034 Fidelity Small Cap Stock Fund (a) 6, ,666 Fidelity Software and IT Services Portfolio (a) 31,480 3,806,208 Fidelity Technology Portfolio (a) 105,489 12,341,190 Fidelity Telecom and Utilities Fund (a) 33, ,687 Fidelity Telecommunications Portfolio (a) 77,976 5,504,360 Fidelity Utilities Portfolio (a) 42,422 3,298,700 TOTAL DOMESTIC EQUITY FUNDS 115,047,182 International Equity Funds 6.1% Fidelity Diversified International Fund (a) 1,314 43,693 Fidelity Emerging Asia Fund (a) 74,063 2,287,810 Fidelity Emerging Markets Fund (a) 85,040 1,967,819 Shares Value Fidelity Europe Fund (a) 18,690 $ 632,266 Fidelity International Capital Appreciation Fund (a) 184,000 3,105,912 Fidelity International Discovery Fund (a) 17, ,994 Fidelity International Index Fund Premium Class (a) 178,209 6,183,846 Fidelity International Real Estate Fund (a) 1,181 11,979 Fidelity International Small Cap Fund (a) 179,411 4,079,806 Fidelity International Small Cap Opportunities Fund (a) 403,044 5,840,107 Fidelity Japan Smaller Companies Fund (a) 138,540 2,047,621 Fidelity Nordic Fund (a) 65,372 3,018,879 Fidelity Overseas Fund (a) 346,198 13,681,755 Fidelity Pacific Basin Fund (a) 61,754 1,712,431 TOTAL INTERNATIONAL EQUITY FUNDS 45,264,918 TOTAL EQUITY FUNDS (Cost $143,601,005) 160,312,100 Fixed-Income Funds 49.8% Fidelity Floating Rate High Income Fund (a) 1,590,442 14,870,634 Fidelity Focused High Income Fund (a) 39, ,412 Fidelity High Income Fund (a) 42, ,756 Fidelity Inflation Protected Bond Index Fund Institutional Class (a) 1,586,645 15,818,849 Fidelity Long Term Treasury Bond Index Fund Premium Class (a) 678,793 9,883,225 Fidelity New Markets Income Fund (a) 190,403 3,008,372 Fidelity Real Estate Income Fund (a) 244,164 2,922,642 Fidelity U.S. Bond Index Fund Institutional Premium Class (a) 27,125, ,416,992 TOTAL FIXED-INCOME FUNDS (Cost $350,628,146) 371,597,882 Semi-Annual Report 4

5 Money Market Funds 28.7% Shares Value Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% (a)(c) 98,060,120 $ 98,060,120 Fidelity Investments Money Market Treasury Portfolio Institutional Class 0.23% (a)(c) 116,411, ,411,338 TOTAL MONEY MARKET FUNDS (Cost $214,471,458) 214,471,458 TOTAL INVESTMENT PORTFOLIO 100.0% (Cost $708,700,609) 746,381,440 NET OTHER ASSETS (LIABILITIES) 0.0% 262,327 NET ASSETS 100% $746,643,767 Legend (a) Affiliated Fund (b) Non-income producing (c) The rate quoted is the annualized seven-day yield of the fund at period end. Affiliated Underlying Funds Information regarding the Fund s fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows: Affiliate Value, beginning of period Purchases Sales Proceeds Dividend Income Fidelity Air Transportation Portfolio $ 274,921 $ $ 276,333 $ $ Fidelity Banking Portfolio 5,195, , ,657 4,572,043 Fidelity Blue Chip Growth Fund 812, ,439 87,108 Fidelity Blue Chip Value Fund 2,032, ,475 2,470,656 Fidelity Brokerage and Investment Management Portfolio 180, ,777 Fidelity Chemicals Portfolio 1,940,637 1,286, ,025 3,146,681 Fidelity China Region Fund 1,656,220 1,452,854 Fidelity Computers Portfolio 1,814,151 1,674 1,766,609 1,633 Fidelity Construction and Housing Portfolio 4,054, ,592 4,334,322 Fidelity Consumer Discretionary Portfolio 8,257, ,133 1,320,946 7,594 7,302,261 Fidelity Consumer Staples Portfolio 8,896,189 2,565,100 2,109,042 15,793 10,175,696 Fidelity Contrafund 4,905,226 1,641,708 6,173, Fidelity Defense and Aerospace Portfolio 2,117,669 1,268,974 7,387 3,545,852 Fidelity Diversified International Fund 11,563,792 44,551 10,681,640 43,693 Fidelity Dividend Growth Fund 21,407 21,640 Fidelity Electronics Portfolio 2,265,797 1,595,396 1,616 3,880,568 Fidelity Emerging Asia Fund 4,173,569 1,905,041 2,287,810 Fidelity Emerging Markets Fund 1,074, ,783 1,967,819 Fidelity Energy Portfolio 4,793,372 1,601, ,801 5,084 6,474,802 Fidelity Energy Service Portfolio 835, , Fidelity Equity Dividend Income Fund 2,011, ,547 10,226 1,714,247 Fidelity Europe Fund 4,462,814 3,454, ,266 Fidelity Extended Market Index Fund Investor Class 16, Fidelity Extended Market Index Fund Premium Class ,706 Fidelity Financial Services Portfolio 8,028,171 83,990 2,096,515 5,590,213 Fidelity Floating Rate High Income Fund 3,920,869 10,871, ,287 14,870,634 Fidelity Focused High Income Fund 306,157 7,324 7, ,412 Fidelity Global Commodity Stock Fund 34,871 1,139,859 1,208,456 Value, end of period 5 Semi-Annual Report

6 Investments (Unaudited) continued Affiliate Value, beginning of period Purchases Sales Proceeds Dividend Income Fidelity Gold Portfolio 94,034 1, ,706 Fidelity Health Care Portfolio 5,467, ,684 3,654,865 1,686,002 Fidelity Health Care Services Portfolio $ 1,885,014 $ 29,854 $ 6,415 $ $ 1,947,733 Fidelity High Income Fund 329,415 9,716 9, ,756 Fidelity Industrial Equipment Portfolio 682,849 1,495,562 2,308,484 Fidelity Industrials Portfolio 6,750, ,157 2,789,520 4,774,628 Fidelity Inflation-Protected Bond Index Fund Institutional Class 26,783 45, ,818,849 Fidelity Inflation-Protected Bond Index Fund Investor Class 11,115,443 4,388, , Fidelity Insurance Portfolio 4,871, ,166 11,149 5,593,517 Fidelity International Capital Appreciation Fund 355,942 3,079, ,870 3,105,912 Fidelity International Discovery Fund 2,593, ,088 2,112, ,994 Fidelity International Index Fund Investor Class 7,015,151 34,216 3,823,709 6,766 Fidelity International Index Fund Premium Class 3,180,000 6,183,846 Fidelity International Real Estate Fund 11,838 11,979 Fidelity International Small Cap Fund 2,011,705 1,858,331 4,079,806 Fidelity International Small Cap Opportunities Fund 3,908,429 2,456, ,000 5,840,107 Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% 129,614,953 31,554, ,472 98,060,120 Fidelity Investments Money Market Portfolio Class I 0.42% 116,279,132 31, ,310,491 42,186 Fidelity Investments Money Market Treasury Portfolio Institutional Class 0.23% 116,411, , ,411,338 Fidelity Investments Prime Money Market Portfolio Class I 0.44% 86,244, ,372 86,516,576 31,424 Fidelity IT Services Portfolio 2,312, , ,889 2,121,498 Fidelity Japan Fund 2,271,246 2,110,258 Fidelity Japan Smaller Companies Fund 3,538, ,979 2,500,000 2,047,621 Fidelity Large Cap Stock Fund 98, ,620 Fidelity Long-Term Treasury Bond Index Fund Investor Class 13,880, ,491 6,128, ,138 Fidelity Long-Term Treasury Bond Index Fund Premium Class 26,059 29,516 6,621 9,883,225 Fidelity Low-Priced Stock Fund 3,970, ,034 4,386,922 83,146 Fidelity Materials Portfolio 430, , , ,124 Fidelity Medical Equipment and Systems Portfolio 5,236,775 2,440,897 19,244 8,579,244 Fidelity Mid Cap Value Fund 231, ,005 Fidelity Natural Gas Portfolio 3, ,861 Fidelity New Markets Income Fund 3,678, ,795 1,000,000 84,098 3,008,372 Fidelity Nordic Fund 2,964,957 3,018,879 Fidelity OTC Portfolio 54,805 74, ,676 Fidelity Overseas Fund 18,642, ,296 5,324,565 13,681,755 Fidelity Pacific Basin Fund 1,625,358 1,712,431 Fidelity Pharmaceuticals Portfolio 1,892,123 1,240, ,172 Fidelity Real Estate Income Fund 2,565, ,515 40,046 2,922,642 Fidelity Real Estate Investment Portfolio 3,203,294 1,267, ,087 20,152 4,734,208 Fidelity Retailing Portfolio 2,389, , ,586,743 Fidelity Series Commodity Strategy Fund 5,316 1,575,083 1,661,034 Fidelity Small Cap Stock Fund 108,883 2, ,666 Fidelity Software and IT Services Portfolio 1,904,420 1,886,477 1,039 3,806,208 Fidelity Stock Selector Large Cap Value Fund 663, , ,718 Fidelity Technology Portfolio 13,331, ,047 1,269,682 12,341,190 Fidelity Telecom and Utilities Fund 726,596 4, ,687 Fidelity Telecommunications Portfolio 3,105,150 1,705,961 76,975 9,059 5,504,360 Fidelity U.S. Bond Index Fund Institutional Premium Class 1,434, , , ,416,992 Fidelity U.S. Bond Index Fund Investor Class 315,178,807 28,328,329 32,202,554 3,486,080 Fidelity Utilities Portfolio 973,785 2,360, ,331 2,467 3,298,700 Fidelity Value Discovery Fund 812, ,040 Total $ 734,549,008 $ 341,764,489 $ 346,426,452 $ 4,533,685 $ 746,381,440 Value, end of period Semi-Annual Report 6

7 Investment Valuation All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements. 7 Semi-Annual Report

8 VIP FundsManager 20% Portfolio Financial Statements Statement of Assets and Liabilities June 30, 2016 (Unaudited) Assets Investment in securities, at value (cost $708,700,609) See accompanying schedule $ 746,381,440 Cash 4 Receivable for investments sold 13 Receivable for fund shares sold 373,017 Dividends receivable 397,276 Total assets 747,151,750 Liabilities Payable for investments purchased $ 383,721 Payable for fund shares redeemed 31 Accrued management fee 123,936 Distribution and service plan fees payable 295 Total liabilities 507,983 Net Assets $ 746,643,767 Net Assets consist of: Paid in capital $ 707,129,941 Undistributed net investment income 3,748,000 Accumulated undistributed net realized gain (loss) on investments (1,915,005) Net unrealized appreciation (depreciation) on investments 37,680,831 Net Assets $ 746,643,767 Service Class: Net Asset Value, offering price and redemption price per share ($60,756 5,427 shares) $ Service Class 2: Net Asset Value, offering price and redemption price per share ($2,422, ,901 shares) $ Investor Class: Net Asset Value, offering price and redemption price per share ($744,160,863 66,508,901 shares) $ Statement of Operations Six months ended June 30, 2016 (Unaudited) Investment Income Income distributions from underlying funds $ 4,533,685 Expenses Management fee $ 913,704 Distribution and service plan fees 2,375 Independent trustees fees and expenses 1,659 Total expenses before reductions 917,738 Expense reductions (184,100) 733,638 Net investment income (loss) 3,800,047 Realized and Unrealized Gain (Loss) Realized gain (loss) on sale of underlying fund shares (1,711,064) Capital gain distributions from underlying funds 405,809 Total net realized gain (loss) (1,305,255) Change in net unrealized appreciation (depreciation) on underlying funds 18,205,458 Net gain (loss) 16,900,203 Net increase (decrease) in net assets resulting from operations $ 20,700,250 Semi-Annual Report 8

9 Statement of Changes in Net Assets Six months ended June 30, 2016 (Unaudited) Year ended December 31, 2015 Increase (Decrease) in Net Assets Operations Net investment income (loss) $ 3,800,047 $ 8,791,053 Net realized gain (loss) (1,305,255) 10,385,774 Change in net unrealized appreciation (depreciation) 18,205,458 (19,017,635) Net increase (decrease) in net assets resulting from operations 20,700, ,192 Distributions to shareholders from net investment income (66,551) (8,798,379) Distributions to shareholders from net realized gain (8,917,973) (23,627,789) Total distributions (8,984,524) (32,426,168) Share transactions net increase (decrease) 501,337 4,615,665 Total increase (decrease) in net assets 12,217,063 (27,651,311) Net Assets Beginning of period 734,426, ,078,015 End of period $ 746,643,767 $ 734,426,704 Other Information Undistributed net investment income end of period $ 3,748,000 $ 14,504 9 Semi-Annual Report

10 Financial Highlights VIP FundsManager 20% Portfolio Service Class Six months ended (Unaudited) June 30, Years ended December 31, Selected Per Share Data Net asset value, beginning of period $ $ $ $ $ $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).26 (.13) Total from investment operations.32 B Distributions from net investment income B (.13) (.15) (.14) (.16) (.18) Distributions from net realized gain (.13) (.36) (.15) (.24) (.03) (.02) Total distributions (.14) C (.49) (.29) D (.38) (.19) (.20) Net asset value, end of period $ $ $ $ $ $ Total Return E,F,G 2.92% (.03)% 4.21% 5.53% 5.68% 2.30% Ratios to Average Net Assets H,I Expenses before reductions.35% J.35%.35%.35%.35%.35% Expenses net of fee waivers, if any.20% J.20%.20%.20%.20%.20% Expenses net of all reductions.20% J.20%.20%.20%.20%.20% Net investment income (loss) 1.04% J 1.16% 1.31% 1.23% 1.51% 1.84% Supplemental Data Net assets, end of period (000 omitted) $ 61 $ 62 $ 68 $ 72 $ 71 $ 64 Portfolio turnover rate H 93% J 44% 28% 25% 17% 12% A Calculated based on average shares outstanding during the period. B Amount represents less than $.005 per share. C Total distributions of $.14 per share is comprised of distributions from net investment income of $.001 and distributions from net realized gain of $.134 per share. D Total distributions of $.29 per share is comprised of distributions from net investment income of $.147 and distributions from net realized gain of $.147 per share. E Total returns for periods of less than one year are not annualized. F Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. H Amounts do not include the activity of the Underlying Funds. I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. J Annualized Semi-Annual Report 10

11 Financial Highlights VIP FundsManager 20% Portfolio Service Class 2 Six months ended (Unaudited) June 30, Years ended December 31, Selected Per Share Data Net asset value, beginning of period $ $ $ $ $ $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).26 (.12) Total from investment operations.31 (.01) Distributions from net investment income B (.12) (.13) (.12) (.14) (.16) Distributions from net realized gain (.13) (.36) (.15) (.24) (.03) (.02) Total distributions (.14) C (.48) (.28) (.36) (.17) (.18) Net asset value, end of period $ $ $ $ $ $ Total Return D,E,F 2.83% (.17)% 3.98% 5.46% 5.43% 2.20% Ratios to Average Net Assets G,H Expenses before reductions.50% I.50%.50%.50%.50%.50% Expenses net of fee waivers, if any.35% I.35%.35%.35%.35%.35% Expenses net of all reductions.35% I.35%.35%.35%.35%.35% Net investment income (loss).89% I 1.01% 1.16% 1.08% 1.36% 1.69% Supplemental Data Net assets, end of period (000 omitted) $ 2,422 $ 1,454 $ 1,426 $ 1,197 $ 1,274 $ 1,373 Portfolio turnover rate G 93% I 44% 28% 25% 17% 12% A Calculated based on average shares outstanding during the period. B Amount represents less than $.005 per share. C Total distributions of $.14 per share is comprised of distributions from net investment income of $.001 and distributions from net realized gain of $.134 per share. D Total returns for periods of less than one year are not annualized. E Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. F Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. G Amounts do not include the activity of the Underlying Funds. H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. I Annualized 11 Semi-Annual Report

12 Financial Highlights VIP FundsManager 20% Portfolio Investor Class Selected Per Share Data Net asset value, beginning of period $ Six months ended (Unaudited) June 30, Years ended December 31, $ $ $ $ $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).26 (.13) Total from investment operations.32 B Distributions from net investment income B (.13) (.15) (.14) (.16) (.18) Distributions from net realized gain (.13) (.36) (.15) (.24) (.03) (.02) Total distributions (.14) C (.49) (.29) D (.38) (.19) (.20) Net asset value, end of period $ $ $ $ $ $ Total Return E,F,G 2.92% (.03)% 4.12% 5.62% 5.58% 2.31% Ratios to Average Net Assets H,I Expenses before reductions.25% J.25%.25%.25%.25%.25% Expenses net of fee waivers, if any.20% J.20%.20%.20%.20%.20% Expenses net of all reductions.20% J.20%.20%.20%.20%.20% Net investment income (loss) 1.04% J 1.16% 1.31% 1.23% 1.51% 1.84% Supplemental Data Net assets, end of period (000 omitted) $ 744,161 $ 732,911 $ 760,583 $ 694,546 $ 650,963 $ 533,568 Portfolio turnover rate H 93% J 44% 28% 25% 17% 12% A Calculated based on average shares outstanding during the period. B Amount represents less than $.005 per share. C Total distributions of $.14 per share is comprised of distributions from net investment income of $.001 and distributions from net realized gain of $.134 per share. D Total distributions of $.29 per share is comprised of distributions from net investment income of $.147 and distributions from net realized gain of $.147 per share. E Total returns for periods of less than one year are not annualized. F Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. H Amounts do not include the activity of the Underlying Funds. I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. J Annualized Semi-Annual Report 12

13 VIP FundsManager 50% Portfolio Investment Summary (Unaudited) The information in the following tables is based on the direct investments of the Fund. Top Holdings as of June 30, 2016 % of fund s net assets % of fund s net assets 6 months ago Fidelity U.S. Bond Index Fund Institutional Premium Class Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% Fidelity Overseas Fund Fidelity Technology Portfolio Fidelity Consumer Staples Portfolio Fidelity Consumer Discretionary Portfolio Fidelity Diversified International Fund Fidelity Inflation-Protected Bond Index Fund Institutional Premium Class Fidelity Financial Services Portfolio Fidelity Industrials Portfolio Asset Allocation (% of fund s net assets) As of June 30, 2016 Domestic Equity Funds 36.4% International Equity Funds 15.0% Fixed-Income Funds 39.6% Money Market Funds 9.0% As of December 31, 2015 Domestic Equity Funds 37.1% International Equity Funds 17.8% Fixed-Income Funds 37.6% Money Market Funds 7.5% 13 Semi-Annual Report

14 VIP FundsManager 50% Portfolio Investments June 30, 2016 (Unaudited) Showing Percentage of Net Assets Equity Funds 51.4% Shares Value Domestic Equity Funds 36.4% Fidelity 500 Index Fund Premium Class (a) 3,122 $ 231,506 Fidelity Air Transportation Portfolio (a) 51,400 3,098,902 Fidelity Banking Portfolio (a) 3,426,054 80,854,880 Fidelity Blue Chip Growth Fund (a) 512,103 33,378,860 Fidelity Blue Chip Value Fund (a) 2,859,782 44,555,404 Fidelity Chemicals Portfolio (a) 423,960 58,820,236 Fidelity Computers Portfolio (a) 111,346 7,429,000 Fidelity Construction and Housing Portfolio (a) 707,005 42,215,293 Fidelity Consumer Discretionary Portfolio (a) 4,800, ,644,637 Fidelity Consumer Finance Portfolio (a) 191,976 2,165,491 Fidelity Consumer Staples Portfolio (a) 2,001, ,313,212 Fidelity Contrafund (a) 238,913 23,181,737 Fidelity Defense and Aerospace Portfolio (a) 375,001 44,688,920 Fidelity Dividend Growth Fund (a) 5, ,148 Fidelity Electronics Portfolio (a) 690,793 52,293,042 Fidelity Energy Portfolio (a) 2,690, ,842,648 Fidelity Energy Service Portfolio (a) 92,923 4,149,026 Fidelity Equity Dividend Income Fund (a) 828,796 21,515,534 Fidelity Financial Services Portfolio (a) 1,596, ,486,763 Fidelity Global Commodity Stock Fund (a) 822,115 8,410,232 Fidelity Gold Portfolio (a) 5, ,628 Fidelity Growth Company Fund (a) 1, ,600 Fidelity Health Care Portfolio (a) 579, ,624,047 Fidelity Health Care Services Portfolio (a) 292,527 25,192,407 Fidelity Industrial Equipment Portfolio (a) 1,076,703 41,173,140 Fidelity Industrials Portfolio (a) 3,927, ,363,770 Fidelity Insurance Portfolio (a) 1,179,879 80,444,182 Fidelity IT Services Portfolio (a) 758,304 29,687,591 Fidelity Large Cap Stock Fund (a) 1,084,701 28,180,533 Fidelity Low Priced Stock Fund (a) 14, ,151 Fidelity Magellan Fund (a) ,150 Fidelity Materials Portfolio (a) 72,856 5,097,750 Fidelity Medical Equipment and Systems Portfolio (a) 1,698,383 67,935,324 Fidelity Mid Cap Value Fund (a) 31, ,040 Fidelity Nasdaq Composite Index Fund (a) 10, ,125 Fidelity OTC Portfolio (a) 243,506 18,961,838 Fidelity Pharmaceuticals Portfolio (a) 1,332,891 25,311,597 Fidelity Real Estate Investment Portfolio (a) 1,020,289 46,382,353 Fidelity Retailing Portfolio (a) 341,570 35,940,023 Fidelity Series Commodity Strategy Fund (a)(b) 2,789,419 15,397,591 Fidelity Small Cap Growth Fund (a) 5, ,070 Shares Value Fidelity Small Cap Stock Fund (a) 858,869 $ 14,815,491 Fidelity Small Cap Value Fund (a) 12, ,539 Fidelity Software and IT Services Portfolio (a) 732,707 88,591,637 Fidelity Stock Selector Large Cap Value Fund (a) 4,436,180 76,302,288 Fidelity Technology Portfolio (a) 1,879, ,909,481 Fidelity Telecom and Utilities Fund (a) 637,340 16,698,308 Fidelity Telecommunications Portfolio (a) 1,577, ,378,012 Fidelity Utilities Portfolio (a) 811,852 63,129,621 Fidelity Value Discovery Fund (a) 1,230,849 28,691,097 TOTAL DOMESTIC EQUITY FUNDS 2,301,456,855 International Equity Funds 15.0% Fidelity Diversified International Fund (a) 4,321, ,719,667 Fidelity Emerging Asia Fund (a) 1,103,840 34,097,602 Fidelity Emerging Markets Fund (a) 337,148 7,801,609 Fidelity Europe Fund (a) 2,270,222 76,801,616 Fidelity International Capital Appreciation Fund (a) 1,715,849 28,963,533 Fidelity International Discovery Fund (a) 2,077,198 76,752,484 Fidelity International Index Fund Institutional Class (a) 3,402, ,069,556 Fidelity International Real Estate Fund (a) 15, ,364 Fidelity International Small Cap Fund (a) 1,808,156 41,117,472 Fidelity International Small Cap Opportunities Fund (a) 5,183,386 75,107,270 Fidelity Japan Fund (a) 1,233,367 14,430,394 Fidelity Japan Smaller Companies Fund (a) 3,935,359 58,164,610 Fidelity Nordic Fund (a) 669,015 30,895,095 Fidelity Overseas Fund (a) 5,930, ,368,796 Fidelity Pacific Basin Fund (a) 350,614 9,722,534 TOTAL INTERNATIONAL EQUITY FUNDS 950,172,602 TOTAL EQUITY FUNDS (Cost $3,044,235,143) 3,251,629,457 Semi-Annual Report 14

15 Fixed-Income Funds 39.6% Shares Value Fidelity Floating Rate High Income Fund (a) 10,191,880 $ 95,294,079 Fidelity Focused High Income Fund (a) 61, ,101 Fidelity High Income Fund (a) 614,512 5,112,738 Fidelity Inflation Protected Bond Index Fund Institutional Premium Class (a) 13,450, ,099,703 Fidelity Long Term Treasury Bond Index Fund Premium Class (a) 5,208,018 75,828,740 Fidelity New Markets Income Fund (a) 1,487,222 23,498,106 Fidelity Real Estate Income Fund (a) 1,585,539 18,978,898 Fidelity U.S. Bond Index Fund Institutional Premium Class (a) 179,545,714 2,147,366,735 TOTAL FIXED-INCOME FUNDS (Cost $2,414,202,962) 2,500,684,100 Money Market Funds 9.0% Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% (a)(c) (Cost $567,116,405) 567,116, ,116,405 TOTAL INVESTMENT PORTFOLIO 100.0% (Cost $6,025,554,510) 6,319,429,962 NET OTHER ASSETS (LIABILITIES) 0.0% 1,518,934 NET ASSETS 100% $6,320,948,896 Legend (a) Affiliated Fund (b) Non-income producing (c) The rate quoted is the annualized seven-day yield of the fund at period end. Affiliated Underlying Funds Information regarding the Fund s fiscal year to date purchases and sales of the affiliated Underlying Funds and income earned by the Fund from investments in affiliated Underlying Funds is as follows: Affiliate Value, beginning of period Purchases Sales Proceeds Dividend Income Fidelity 500 Index Fund Investor Class $ 223,048 $ $ $ 1,081 $ Fidelity 500 Index Fund Premium Class 1, ,506 Fidelity Air Transportation Portfolio 9,262,502 5,850,000 3,098,902 Fidelity Automotive Portfolio 6,469,331 5,178,285 Fidelity Banking Portfolio 85,594,035 4,214,408 2,103,785 80,854,880 Fidelity Blue Chip Growth Fund 108,678, ,822 68,959,191 33,378,860 Fidelity Blue Chip Value Fund 50,999,832 4,050,861 10,458,331 44,555,404 Fidelity Brokerage and Investment Management Portfolio 14,411,464 12,434,288 Fidelity Chemicals Portfolio 37,983,812 24,097,493 5,687,500 58,820,236 Fidelity China Region Fund 11,950,996 10,463,451 Fidelity Computers Portfolio 22,816,977 21,887 14,152,814 21,349 7,429,000 Fidelity Construction and Housing Portfolio 38,625,226 3,433, ,000 42,215,293 Value, end of period 15 Semi-Annual Report

16 Investments (Unaudited) continued Affiliate Value, beginning of period Purchases Sales Proceeds Dividend Income Fidelity Consumer Discretionary Portfolio 169,442,046 6,505,389 11,500, , ,644,637 Fidelity Consumer Finance Portfolio 3,103,656 67, ,000 5,941 2,165,491 Fidelity Consumer Staples Portfolio $ 160,136,675 $ 51,087,214 $ 29,841,580 $ 301,169 $ 197,313,212 Fidelity Contrafund 68,386,975 9,929,260 53,527,662 8,739 23,181,737 Fidelity Defense and Aerospace Portfolio 37,175,626 5,772,736 93,099 44,688,920 Fidelity Diversified International Fund 338,225, ,921, ,719,667 Fidelity Dividend Growth Fund 172, ,148 Fidelity Electronics Portfolio 27,604,565 24,420,637 20,633 52,293,042 Fidelity Emerging Asia Fund 46,376,813 12,939,638 34,097,602 Fidelity Emerging Markets Fund 4,283,885 5,235,671 2,000,000 7,801,609 Fidelity Energy Portfolio 83,220,015 16,896,759 4,091,086 94, ,842,648 Fidelity Energy Service Portfolio 11,903,027 2,322 8,600,000 2,322 4,149,026 Fidelity Equity Dividend Income Fund 26,451,644 7,000,000 83,714 21,515,534 Fidelity Europe Fund 107,632,829 24,271,444 76,801,616 Fidelity Financial Services Portfolio 148,547, ,518 13,643, ,486,763 Fidelity Floating Rate High Income Fund 32,122,729 62,445, ,813 95,294,079 Fidelity Focused High Income Fund 466,598 24,838 11, ,101 Fidelity Global Commodity Stock Fund 42,364 8,232,253 8,410,232 Fidelity Gold Portfolio 79,341 1, ,628 Fidelity Growth Company Fund 206, ,600 Fidelity Health Care Portfolio 157,801,720 11,610,440 42,879, ,624,047 Fidelity Health Care Services Portfolio 22,374,105 2,689, ,639 25,192,407 Fidelity High Income Fund 4,747, , ,032 5,112,738 Fidelity Industrial Equipment Portfolio 33,842,662 5,417,965 41,173,140 Fidelity Industrials Portfolio 100,736,644 31,823,307 16,216, ,363,770 Fidelity Inflation-Protected Bond Index Fund Institutional Premium Class 85, , ,099,703 Fidelity Inflation-Protected Bond Index Fund Investor Class 103,837,384 25,073,999 1,870, Fidelity Insurance Portfolio 65,956,537 13,193, ,717 80,444,182 Fidelity International Capital Appreciation Fund 1,316,862 28,237,260 1,224,103 28,963,533 Fidelity International Discovery Fund 100,651,836 6,128,686 23,310,215 76,752,484 Fidelity International Index Fund Institutional Class 39,844, ,069,556 Fidelity International Index Fund Investor Class 82,634, ,770 3,150, ,924 Fidelity International Real Estate Fund 158, ,364 Fidelity International Small Cap Fund 15,438,298 24,445,569 41,117,472 Fidelity International Small Cap Opportunities Fund 49,732,063 26,389,620 75,107,270 Fidelity International Value Fund 4,294,764 3,922,319 Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% 737,972, ,855, , ,116,405 Fidelity Investments Prime Money Market Portfolio Class I 0.44% 463,644, , ,771, ,608 Fidelity IT Services Portfolio 36,922,810 6,464,841 13,475,186 29,687,591 Fidelity Japan Fund 50,245,967 33,721,626 14,430,394 Fidelity Japan Smaller Companies Fund 39,529,567 14,546,835 58,164,610 Fidelity Large Cap Stock Fund 36,507, ,995 8,409, ,626 28,180,533 Fidelity Leisure Portfolio 789, ,063 Fidelity Long-Term Treasury Bond Index Fund Investor Class 92,436,385 4,480,470 32,422,683 1,137,534 Fidelity Long-Term Treasury Bond Index Fund Premium Class 100, ,670 50,766 75,828,740 Fidelity Low-Priced Stock Fund 31,042,654 4,781,511 34,926, ,151 Fidelity Magellan Fund 13, ,150 Fidelity Materials Portfolio 5,717,244 5,137,780 5,034,781 5,097,750 Fidelity Medical Equipment and Systems Portfolio 40,385,234 19,763, ,532 67,935,324 Fidelity Mega Cap Stock Fund 38,159,112 37,517,242 Fidelity Mid Cap Value Fund 36,114,586 1,900,000 36,027, ,040 Fidelity Nasdaq Composite Index Fund 711, ,125 Fidelity New Markets Income Fund 20,190,757 2,550,368 1,000, ,324 23,498,106 Fidelity Nordic Fund 17,654,336 13,632,999 30,895,095 Fidelity OTC Portfolio 8,568,139 12,367,361 1,000,000 18,961,838 Fidelity Overseas Fund 214,102,961 31,482,386 5,319, ,368,796 Value, end of period Semi-Annual Report 16

17 Affiliate Value, beginning of period Purchases Sales Proceeds Dividend Income Fidelity Pacific Basin Fund 9,228,168 9,722,534 Fidelity Pharmaceuticals Portfolio 35,592,219 7,360,000 25,311,597 Fidelity Real Estate Income Fund $ 16,379,032 $ 1,513,601 $ $ 259,050 $ 18,978,898 Fidelity Real Estate Investment Portfolio 31,435,595 10,810, , ,480 46,382,353 Fidelity Retailing Portfolio 30,684,296 5,263,219 2,333 35,940,023 Fidelity Series Commodity Strategy Fund 5,316 14,669,100 15,397,591 Fidelity Small Cap Growth Fund 105, ,070 Fidelity Small Cap Stock Fund 14,380, ,644 14,815,491 Fidelity Small Cap Value Fund 205, ,539 Fidelity Software and IT Services Portfolio 56,717,029 33,231,051 1,349,654 25,283 88,591,637 Fidelity Stock Selector Large Cap Value Fund 70,476,339 7,412,490 5,935,095 76,302,288 Fidelity Technology Portfolio 217,741,598 10,021,594 5,526, ,909,481 Fidelity Telecom and Utilities Fund 14,303,537 83,670 16,698,308 Fidelity Telecommunications Portfolio 59,301,007 36,116, , ,378,012 Fidelity U.S. Bond Index Fund Institutional Premium Class 2,839,725 3,034,341 1,429,095 2,147,366,735 Fidelity U.S. Bond Index Fund Investor Class 2,032,935, ,676, ,196,864 23,013,485 Fidelity Utilities Portfolio 14,461,606 45,469,683 6,295,259 46,042 63,129,621 Fidelity Value Discovery Fund 38,643,322 4,567,350 15,107,167 28,691,097 Total $ 6,130,697,370 $ 1,677,697,930 $ 1,597,950,075 $ 30,216,175 $ 6,319,429,962 Value, end of period Investment Valuation All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements. 17 Semi-Annual Report

18 VIP FundsManager 50% Portfolio Financial Statements Statement of Assets and Liabilities June 30, 2016 (Unaudited) Assets Investment in securities, at value (cost $6,025,554,510) See accompanying schedule $ 6,319,429,962 Receivable for investments sold 4,041,727 Receivable for fund shares sold 1,344 Dividends receivable 2,658,209 Total assets 6,326,131,242 Liabilities Payable for investments purchased $ 2,760,677 Payable for fund shares redeemed 1,359,264 Accrued management fee 1,051,075 Distribution and service plan fees payable 11,330 Total liabilities 5,182,346 Net Assets $ 6,320,948,896 Net Assets consist of: Paid in capital $ 6,061,575,207 Undistributed net investment income 23,999,280 Accumulated undistributed net realized gain (loss) on investments (58,501,043) Net unrealized appreciation (depreciation) on investments 293,875,452 Net Assets $ 6,320,948,896 Service Class: Net Asset Value, offering price and redemption price per share ($62,224 5,202 shares) $ Service Class 2: Net Asset Value, offering price and redemption price per share ($90,879,597 7,625,956 shares) $ Investor Class: Net Asset Value, offering price and redemption price per share ($6,230,007, ,897,775 shares) $ Statement of Operations Six months ended June 30, 2016 (Unaudited) Investment Income Income distributions from underlying funds $ 30,216,175 Expenses Management fee $ 7,679,187 Distribution and service plan fees 106,602 Independent trustees fees and expenses 13,876 Total expenses before reductions 7,799,665 Expense reductions (1,582,770) 6,216,895 Net investment income (loss) 23,999,280 Realized and Unrealized Gain (Loss) Realized gain (loss) on sale of underlying fund shares (60,713,086) Capital gain distributions from underlying funds 6,964,949 Total net realized gain (loss) (53,748,137) Change in net unrealized appreciation (depreciation) on underlying funds 169,697,817 Net gain (loss) 115,949,680 Net increase (decrease) in net assets resulting from operations $ 139,948,960 Semi-Annual Report 18

19 Statement of Changes in Net Assets Six months ended June 30, 2016 (Unaudited) Year ended December 31, 2015 Increase (Decrease) in Net Assets Operations Net investment income (loss) $ 23,999,280 $ 68,032,841 Net realized gain (loss) (53,748,137) 90,122,692 Change in net unrealized appreciation (depreciation) 169,697,817 (166,818,526) Net increase (decrease) in net assets resulting from operations 139,948,960 (8,662,993) Distributions to shareholders from net investment income (69,982,049) Distributions to shareholders from net realized gain (71,969,152) (180,001,166) Total distributions (71,969,152) (249,983,215) Share transactions net increase (decrease) 123,311,792 1,213,704,685 Total increase (decrease) in net assets 191,291, ,058,477 Net Assets Beginning of period 6,129,657,296 5,174,598,819 End of period $ 6,320,948,896 $ 6,129,657,296 Other Information Undistributed net investment income end of period $ 23,999,280 $ 19 Semi-Annual Report

20 Financial Highlights VIP FundsManager 50% Portfolio Service Class Six months ended (Unaudited) June 30, Years ended December 31, Selected Per Share Data Net asset value, beginning of period $ $ $ $ $ 9.78 $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).20 (.13) (.23) Total from investment operations (.04) Distributions from net investment income (.14) (.14) (.12) (.13) (.18) Distributions from net realized gain (.14) (.42) (.10) (.07) (.03) (.02) Total distributions (.14) (.56) (.24) (.18) B (.16) (.20) Net asset value, end of period $ $ $ $ $ $ 9.78 Total Return C,D,E 2.19%.06% 5.18% 14.79% 10.24% (.42)% Ratios to Average Net Assets F,G Expenses before reductions.35% H.35%.35%.35%.35%.35% Expenses net of fee waivers, if any.20% H.20%.20%.20%.20%.20% Expenses net of all reductions.20% H.20%.20%.20%.20%.20% Net investment income (loss).78% H 1.19% 1.38% 1.33% 1.77% 1.84% Supplemental Data Net assets, end of period (000 omitted) $ 62 $ 64 $ 73 $ 80 $ 72 $ 59 Portfolio turnover rate F 52% H 24% 25% 15% 15% 14% A Calculated based on average shares outstanding during the period. B Total distributions of $.18 per share is comprised of distributions from net investment income of $.115 and distributions from net realized gain of $.065 per share. C Total returns for periods of less than one year are not annualized. D Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. F Amounts do not include the activity of the Underlying Funds. G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. H Annualized Semi-Annual Report 20

21 Financial Highlights VIP FundsManager 50% Portfolio Service Class 2 Selected Per Share Data Net asset value, beginning of period $ Six months ended (Unaudited) June 30, Years ended December 31, $ $ $ $ 9.75 $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).20 (.12) (.24) Total from investment operations (.07) Distributions from net investment income (.12) (.12) (.10) (.12) (.17) Distributions from net realized gain (.14) (.42) (.10) (.07) (.03) (.02) Total distributions (.14) (.54) (.22) (.16) B (.15) (.19) Net asset value, end of period $ $ $ $ $ $ 9.75 Total Return C,D,E 2.11% (.02)% 4.95% 14.66% 10.12% (.68)% Ratios to Average Net Assets F,G Expenses before reductions.50% H.50%.50%.50%.50%.50% Expenses net of fee waivers, if any.35% H.35%.35%.35%.35%.35% Expenses net of all reductions.35% H.35%.35%.35%.35%.35% Net investment income (loss).63% H 1.04% 1.23% 1.18% 1.62% 1.69% Supplemental Data Net assets, end of period (000 omitted) $ 90,880 $ 83,447 $ 88,771 $ 89,164 $ 81,647 $ 17,800 Portfolio turnover rate F 52% H 24% 25% 15% 15% 14% A Calculated based on average shares outstanding during the period. B Total distributions of $.16 per share is comprised of distributions from net investment income of $.097 and distributions from net realized gain of $.065 per share. C Total returns for periods of less than one year are not annualized. D Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. F Amounts do not include the activity of the Underlying Funds. G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. H Annualized 21 Semi-Annual Report

22 Financial Highlights VIP FundsManager 50% Portfolio Investor Class Selected Per Share Data Net asset value, beginning of period $ Six months ended (Unaudited) June 30, Years ended December 31, $ $ $ $ 9.78 $ Income from Investment Operations Net investment income (loss) A Net realized and unrealized gain (loss).20 (.12) (.23) Total from investment operations (.04) Distributions from net investment income (.14) (.14) (.12) (.13) (.18) Distributions from net realized gain (.14) (.42) (.10) (.07) (.03) (.02) Total distributions (.14) (.56) (.24) (.18) B (.16) (.20) Net asset value, end of period $ $ $ $ $ $ 9.78 Total Return C,D,E 2.19%.14% 5.10% 14.90% 10.13% (.42)% Ratios to Average Net Assets F,G Expenses before reductions.25% H.25%.25%.25%.25%.25% Expenses net of fee waivers, if any.20% H.20%.20%.20%.20%.20% Expenses net of all reductions.20% H.20%.20%.20%.20%.20% Net investment income (loss).78% H 1.19% 1.38% 1.33% 1.77% 1.84% Supplemental Data Net assets, end of period (000 omitted) $ 6,230,007 $ 6,046,146 $ 5,085,755 $ 3,319,291 $ 1,347,437 $ 747,577 Portfolio turnover rate F 52% H 24% 25% 15% 15% 14% A Calculated based on average shares outstanding during the period. B Total distributions of $.18 per share is comprised of distributions from net investment income of $.115 and distributions from net realized gain of $.065 per share. C Total returns for periods of less than one year are not annualized. D Total returns do not reflect charges attributable to your insurance company s separate account. Inclusion of these charges would reduce the total returns shown. E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown. F Amounts do not include the activity of the Underlying Funds. G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class but do not include expenses of the underlying funds in which the Fund invests. H Annualized Semi-Annual Report 22

23 VIP FundsManager 60% Portfolio Investment Summary (Unaudited) The information in the following tables is based on the direct investments of the Fund. Top Holdings as of June 30, 2016 % of fund s net assets % of fund s net assets 6 months ago Fidelity U.S. Bond Index Fund Institutional Premium Class Fidelity Overseas Fund Fidelity Technology Portfolio Fidelity Consumer Staples Portfolio Fidelity Investments Money Market Government Portfolio Institutional Class 0.30% Fidelity Diversified International Fund Fidelity Consumer Discretionary Portfolio Fidelity Financial Services Portfolio Fidelity Health Care Portfolio Fidelity Industrials Portfolio Asset Allocation (% of fund s net assets) As of June 30, 2016 Domestic Equity Funds 43.4% International Equity Funds 17.9% Fixed-Income Funds 34.9% Money Market Funds 3.8% As of December 31, 2015 Domestic Equity Funds 43.8% International Equity Funds 20.8% Fixed-Income Funds 33.0% Money Market Funds 2.4% 23 Semi-Annual Report