The Japan winger spent part of last season on-loan at Bolton Wanderers.
Gunners coach Neil Banfield told arsenal.com: "Ryo has come over and done ever so well. He had a period where he found it a bit tough, with the demands we were putting on him, but as his character is, he fought hard. He trained with the first team and went on loan to Bolton and has done well there.
"We will sit down in the summer and have a plan for all of our young players, and it will be the manager's decision whether to bring him back or send him out on loan again if he feels he needs another year before he is ready for Arsenal. But he has done extremely well at Bolton."