Xhaka was replaced by Kieran Tierney who made his first appearance in eight games, the Scottish full-back also clearly not yet operating at full fitness.
Despite knowing they desperately needed a goal to progress to the final, Arsenal barely laid a glove on Emery’s Villarreal, registering just two shots on target from 14 attempts.
Captain Pierre-Emerick Aubameyang led the line, and struck the woodwork twice but was substituted ten minutes before the full-time whistle in one of Arteta’s more questionable decisions on the night.
Arteta shed some light on the morale in the dressing room after the game, telling the media: “We are devastated. Really disappointed. We have to congratulate Villarreal. We tried everything until the last minute.
“I think we deserved to win the game but the details define these ties. We had three big chances, they didn’t have anything but they are through. So many things happened to us, and so many players were just trying to compete not at their best.”
The Spaniard went on to claim how Xhaka’s late injury had a huge impact on how his side were planning to tackle Villarreal, explaining: “It changed our plan completely. We prepared everything with Granit in that position. In the first half we struggled with the ball but it’s not an excuse.
“Too many important players had to define the game but not in their right moments.”
Arteta’s job security looks under scrutiny, with the former Gunners midfielder breaking some unwanted records in just over a year at the helm, including the worst start to a season since the 1974/75 campaign.
The Spaniard also oversaw a run of four consecutive home defeats earlier in the season, the first time that has happened to Arsenal since 1959.
Arsenal, meanwhile, now stare down the barrel of no European football next season for the first time in 25 years, though Arteta hasn’t entirely given up of qualifying through a drastic turn around in league form.
The Arsenal boss said: “The only way [to qualify for Europe] is through the Premier League so we know what we have ahead of us. Today is a big disappointment because we tried everything.”