The Championship outfit – inspired by Joshua King's hat-trick – came from behind to triumph 4-1 against their Premier League opponents at Ewood Park.
And Hughes, who managed Blackburn for four years before moving on to take the helm at Manchester City in 2008, admitted that his former club were well worthy of their victory.
"We didn't deserve anything and we were well beaten," the Welshman said.
"Credit to Blackburn, they deserved to go through, they put the ball in good areas and used the threats they had up front.
"We didn't deal with it all afternoon, we got our noses in front without really dictating Blackburn and we allowed them to get back into the game."
Peter Crouch had given the visitors an early lead with his third goal in as many games, but Gary Bowyer's side rallied and equalised through King.
Rudy Gestede then missed a golden chance to put the hosts ahead, but the striker made amends soon after, converting from the penalty spot after he had been brought down in the area by Geoff Cameron – who duly received his marching orders from referee Anthony Taylor.
King then sealed the result with a quick-fire double early in the second half – helped in the main by slack Stoke defending – and Hughes has demanded improvement from his squad.
"If you don't do the fundamentals, you are liable to get punished, so absolutely no complaints," he added.
"For the red card, there was a little bit of contact, I have seen them given, I have seen then not given.
"I couldn't emphasise the point enough in the lead up to the cup games. We wanted to progress. We need to get our heads down this week and not let our season peter out."
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