Arsenal were beaten 1-0 by Monaco as Valencia won the Emirates Cup.
Colombian striker Radamel Falcao scored the only goal of the game, converting a free header from the edge of the six-yard box just before half-time.
The Gunners, who miss out on winning their home tournament for the first time in four years, felt they should have been awarded a late penalty.
Summer signings Alexis Sanchez, Mathieu Debuchy and Calum Chambers made their first starts for Arsenal.
Having won 5-1 against Benfica in their first match, Arsenal struggled against the Ligue 1 outfit and created little in the way of clear-cut chances, with Sanchez rarely on the ball.
Falcao, starting a game for the first time since a serious knee injury in January, opened the scoring on 37 minutes.
Arsenal substitute Chuba Akpom was brought down by visiting goalkeeper Danijel Subasic as he burst into the box, only for referee Martin Atkinson to award a free-kick rather than a penalty – despite replays showing the foul was clearly inside the area.
Spanish side Valencia won the tournament after coming from behind to beat Portugal’s Benfica 3-1 in Sunday’s early kick-off.
Arsenal: Szczesny, Debuchy, Chambers, Koscielny, Monreal, Arteta, Ramsey, Wilshere, Cazorla, Sanchez, Giroud Subs: Martinez, Miquel, Hayden, Bellerin, Coquelin, Flamini, Oxlade-Chamberlain, Zelalem, Akpom.
Monaco: Subasic, Dirar, Carvalho, Raggi, Echiejile, Bakayoko, Kondogbia, Carrasco, Joao Moutinho, Ocampos, Falcao. Subs: Caillard, Fabinho, Abdennour, Berbatov, Germain, Isimat Mirin, Martial, Toulalan, Bahamboula, Diallo.