Stuttgart claim they had been looking to take Gnabry back to his homeland prior to his breakthrough in north London, but accept that the 18-year-old may now be out of their reach.
Schneider told BILD: "It is a fact that he had the chance to return to our club - again over the summer.
"We are still monitoring him and his progress. But there is little doubt that it would be very difficult to re-sign him in the future if he keeps up the good work and turns into an Arsenal regular."
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