This is a fair assessment, including the part about Arteta being lucky to still have his job.
There are two big picture considerations about Arsenal that often get lost but should be at the forefront of any analysis. The first is that the club was a total dumpster fire on every level when Arteta took over - incompetent and potentially corrupt footballing directors, aging squad without much young talent and lots of terrible contracts, and a terrible internal culture with way too much player power. When you look at all the factors together, not just league position but the condition of the roster and the directors, the club was in the worst shape it had been since prior to George Graham's arrival in 1986.
The second is that we have American owners who - rightly or wrongly - tend to see the situation through the lens of how American sports teams are run. When your team is in a bad condition, the way to rebuild is to bring in a younger coach or manager (often one that has been successful as an assistant somewhere else), deprioritize short term results, focus on adding young talent, get rid of bad contracts and trim the wage bill, and basically try to put together a younger cohort of relatively cheap players to grow together, and then look to eventually spend big money later to add to that core once it develops. There are of course differences across sports in terms of salary cap, roster size, etc but as general principles of how to rebuild a team you see variations on this in American football, basketball, baseball, etc. Whether it will work in football is an open question that can be debated but you can't understand what the team is trying to do without understanding that this is how somebody like Josh Kroenke thinks.