The Lilywhites were beaten 3-2 having fallen 3-0 behind by the 56th minute.
Reading, who parted company with head coach Veljko Paunovic after the game, took the lead inside two minutes and extended it by the 17th minute.
It looked game over when their third goal hit the net early in the second half.
Daniel Johnson quickly reduced the arrears and Cameron Archer brought PNE back to within one goal of their visitors.
But late pressure was unable to bring an equaliser.
North End manager Lowe said: "I thought the first-half performance wasn't acceptable, we know that, the start wasn't great.
"To be 2-0 down after 18 minutes was tough, the game plan went out of the window.
"We have fought back from that before but as I said to the group in there, we don't want to keep having to do that.
"They are a great set of lads, have got great character and resilience but we can't keep doing that, can't keep giving teams head starts and expect to win games of football.
"So it is disappointing. We did get a reaction and had we scored late on to make it 3-3, would that have been harsh on Reading? Possibly yes.
"But our performance in the first half was nowhere near the levels."
Lowe changed formation during the first half, substituting Brad Potts and bringing on Liam Lindsay to go to a back four.
Ryan Ledson came off the bench at half-time, with Ched Evans the third change in just the 53rd minute.
Lowe said: "I just wanted to change formation because it wasn't a day for football, we couldn't string two passes together at times to be fair.
"You could hear people get frustrated, we kept going backwards, Reading were solid and resolute to stop us going through.
"I just felt I would bring Pottsy off, keep the midfield three on and bring on Liam who I thought was fantastic by the way.
"We went to a back four and played three strikers up the pitch basically. It worked to an extent because we needed up scoring two goals but in terms of turnovers and giving the ball away, it wasn't good enough.
"The lads have been great for us, we win together, we draw together, we lose together. But I just felt I needed to do something to change it at 2-0 down.
"I'm disappointed towards the end we didn't find a way."