The English champions were bundled out of the cup that they had won three times in a row from 2019 to 2021 with first-half goals coming from Sekou Mara and Moussa Djenepo.
It was a damning evening for Guardiola’s side who had 72 per cent ball possession but only managed seven goal attempts compared to the Saints’ 12.
Among that, Southampton had four on goal compared to City’s none, despite the presence of Erling Haaland who came off the bench in the 56th minute.
“It was a bad night,” Guardiola told reporters. “I know them quite well. We didn’t get close to what we are.
“Three days after facing Chelsea… I’ve nothing to say. They were better, we congratulate them and accept it.
“We have to be prepared every single game when you play for Manchester City. Today we were not.”
The shock loss comes only days ahead of the Manchester derby on Saturday where City will face a sterner United who have improved over the past few months under Erik ten Hag.
“It’s a different competition, but of course if we perform in this way we don’t have a chance,” he said.
“I know the momentum they have. For many years they’re looking forward to being in this position.
“We know exactly what to do to play better and we’re going to try to do it.”