The Gunners have had one of their worst season in two decades, with some supporters calling for the club to sack Arteta.
But Guardiola believes his protege is making positive progress with his squad.
"We [Manchester City] have ambition, because we sustain the success, sustain the work ethic and many things for a long, long time,' said Guardiola.
"Of course, Three in four years I never expected to be honest because I know how everything changes in this country but always we were there.
"Even last season we couldn't compete against Liverpool who were unstoppable but we were second, we were there, every season we are close to the top, the target next season will to be close up there.
"Every season I have the feeling, comparing with the first year I arrived, the opponents are stronger, the managers are stronger. 'Every year Manchester United are strong, Liverpool will be back next season they have been unlucky with many injuries in the same position.
"Chelsea is not necessary what to say what's going to be, Leicester… everybody says, 'oh Leicester' [and writes them off] every season. 'Arsenal… they trust with Mikel because I know him perfectly, they will make a step forward next season.
"Many, many clubs, look at West Ham how good they play this season. Many clubs, that's why it's a massive achievement this season due to the massive contenders we had."