After restoring from Time Capsule, a "Reset Password" button appears on the login screen
You should push the button and set the password to whatever you like.

Since the machine was "factory reset" (as per yours) and then you dropped the TM backup on top of the reset, she/he/it now has non-matching credentials and is asking you to set things right.

Do all this under the usual precautions: own risk, make sure your backup is good and usable in case you have to repeat the process, etc.