Manchester United were dumped out of the competition thanks to goals from Raul Jiminez and Diogo Jota before Marcus Rashford netted with seconds remaining.
The Red Devils rarely threatened Wolves throughout the 90 minutes, as the Molineux outfit knocked out another Premier League giant.
And speaking after the match, Solskjaer slammed his players for starting slow, losing possession too often and lacking quality in the final third.
“We started too slowly and played into their hands,” the Norwegian said.
“Our possession wasn’t bright enough and quick enough, so it’s disappointing.
“I didn’t think we had enough quality in the last third, enough combination play.
“We had decent dominance with the ball in the first half but that doesn’t help if you give the ball away and they can counter.
“This was a big step backwards, mainly because of the quality of the possession and the passing.”
Meanwhile, opposite number Nuno Espirito Santo was overjoyed that his side produced yet another giant-killing.
“I’m very proud of the players,” the Wolves boss told the BBC.
“We had composure, shape, good running. Very well done to the boys and it was a fantastic atmosphere.
“It means a lot because we know how big Wolves were in the 1950s and 1960s and there are people in the stadium who have memories of that.
“To try to achieve the same is much, much harder now but we will try step by step. We will respect everybody in the semi-finals.
“When the transfer window happened we decided to go this way with 16 players.
“Every member of the squad is important and is always involved in competition.
“Of course there are risks but it is my belief that a small squad can achieve things.”