The reason for Rocky's absence in Creed III is not explicitly given in the film, but it is implied that he is still alive and living in Philadelphia, while Adonis and his family have moved to Los Angeles. The film does not focus much on Rocky's character or legacy, and instead allows Adonis to stand on his own as a retired boxer and a mentor to a new generation of fighters.
The real reason for Stallone's absence is due to his ongoing feud with producer
Irwin Winkler, who owns the rights to the Rocky character and franchise. Stallone has expressed his frustration and regret over not having any ownership or creative control over Rocky, and has publicly criticized Winkler for his decisions regarding the spin-off films. Stallone has also stated that he will not appear in any future films involving Winkler or Rocky.