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Pep Guardiola has identified four teams capable of winning the Champions League after Manchester City’s disappointing exit from the competition.

The reigning Premier League champions were outclassed by Real Madrid suffering a 3-1 defeat at the Bernabeu on Wednesday night, sealing a 6-3 aggregate loss in the play-offs.

Despite optimism after a narrow 3-2 first-leg defeat at the Etihad, Kylian Mbappe ended any hopes of a comeback with a stunning hat-trick.

Mbappe opened the scoring within five minutes, capitalizing on a defensive lapse before lofting the ball over Ederson.

He then outmaneuvered Josko Gvardiol to net his second, and after halftime, completed his 21st professional hat-trick. City managed a consolation goal in injury time, but their title defense came to an abrupt and humbling end.

Real Madrid had shown inconsistency in the group stages and La Liga but now look poised to keep the European trophy at the Bernabeu. Speaking post-match, Guardiola acknowledged Madrid as “definite favorites” but highlighted three other teams as strong contenders.

“Of course, Madrid are always favorites,” Guardiola said. “But there are other strong teams. Liverpool are having a great season, Barcelona are performing brilliantly, and Paris Saint-Germain, under my friend Luis Enrique, are on the rise.”

Reflecting on City’s exit, Guardiola admitted Madrid were the better team this time around. “This season, we weren’t at our best. In past seasons, I felt we were better than Madrid, but not this time. They controlled possession, pressed well, and played dynamically. We have to accept it and move forward.”

Despite the setback, Guardiola remains focused on the rest of the season. “We have to try to win the FA Cup, finish in the top four, and return stronger next season. When eliminated in the past, we were close. Tonight, Madrid were simply better, and we must congratulate them.”

Meanwhile, Real Madrid manager Carlo Ancelotti praised his side’s performance. “This was a complete game attack, defense, with and without the ball. We created so many chances. Almost the perfect night.”