The Dutchman had already surpassed expectations by leading his side past his country of birth, Holland, in the previous round, but Spain proved to be one step too far for he and his side.
La Furia Roja played out a goalless first half against Russia before striking thrice in the second period without reply, much to Hiddink's disappointment.
Nonetheless, he moved to praise the opposition, rather than slate his own side.
"We lost against a great team. The Spanish were excellent and deserved to win," he told Record.pt.
He also cited the fact that reaching the semi-final was an achievement worthy of note for Russia.
"Obviously I am very sad at the result, but despite the scoreline I am proud of my team," he added.
"We were more or less on the same level for an hour but we couldn't keep it up.
"That was also their plan to make us tired, very tired so we couldn't mark as well and couldn't play as well in the second half."
He added that experience played a big part: "Big teams know how to use their experience, and the longer a game goes
on they know they have better qualities. It was new for [Hiddink's former team, South] Korea and it's
new for Russia,"
When asked about the final, Hiddink was leaning towards backing Spain, but would not be drawn on a prediction, when considering the Germans' track-record in major tournaments.
"I like teams who have the concept of playing an attacking game, who like to play, who enjoy the game," said the Dutch coach.
"I like to see players who like to play and Spain have a lot of experience and love to play football.
"They can create chances as well and of course they have a chance against Germany.
"Germany have some good games and they have some scrappy games but they're always there where they want to be.
"This will be a match between a physically powerful team against a team that plays one-touch football - I can't predict who will win."
He refused to blame star man Andrei Arshavin for failing to perform, intimating that the pre-match hype and links to big clubs made the emerging star a marked man in the game and that it was difficult for him to do more than he did.
"When he did well in the Sweden game after being suspended [for the first two matches] and then also against Holland it's normal that the team and he got lots of attention," said Hiddink.
"And then a lot of people are writing that he can be a top player in any league.
"He can but Spain focused on him and he had some difficult moments. But that's good for him to have a tough game and to see what he has to do to improve to survive in the big leagues.
"He's got the quality but it's good for him and for us to see the difficulties he has to overcome."
Steve Michaels, Goal.com