Arsenal failed to win the Emirates Cup for the fifth consecutive year, after they were beaten 3-2 by Borussia Dortmund on Sunday afternoon.
Although the Premier League champions started the game brightly, it was the Bundesliga side that took the lead.
Samuele Inacio opened the scoring for Dortmund, before Konstantinos Karetsas curled in a sublime second.
Arsenal pulled one back through Ethan Nwaneri, but the visitors scrambled home a corner kick to restores their two-goal lead.
Viktor Gyokeres then rolled in a penalty kick to keep the scoreline respectable.
Mikel Arteta’s men will play Como on Wednesday, as they prepare for the new season.