Things were looking good for City when Sergio Aguero handed them the lead after the hour mark, but Nacho Monreal levelled the scoring to send the game into extra time, where Alexis Sanchez eventually made the difference.
While Guardiola was frustrated by Arsenal's tactics, he was nonetheless pleased with his side's performance despite the 2-1 defeat.
"In games like this, a semi-final is like a final, you cannot expect to control every situation but we were in control most of the time," Guardiola stated at a news conference.
"They play long balls to Giroud and they counter-attack and with set-pieces they are a tall team. They beat us because of this.
"We did not create too much but it is not easy when there are eight to 10 players there. We put in a good performance, we played like you have to play a final. We did absolutely everything to play. We created more chances than Arsenal. We controlled. We did absolutely everything in the way we want to. We were there all the time. There were 10-20 minutes when they were on top.
"But it's about the result. And Arsenal won. Congratulations.
"But we did well in the cup, all the games away against Premier League teams. We arrive here and we compete, create more chances than our opponent, and hit the post. It was a little bit similar to what happened in the league. Teams do not need to do a lot of things score goals [against us]. We have some problems to score but we play like we want."
City will now turn their attention to the Premier League again as they look to seal a top-four finish, with Manchester United awaiting on Thursday.
"We have to stand up and prepare for the games we have still to play," Guardiola added.
"We have three or four days to recover [before the game with United].
"We are sad now but as soon as possible we will stand up."