UPDATE 3-Samsung posts first quarterly loss on weak chips, LCDs

* Operating loss much worse than expected

* Chip unit posts steeper than expected 14 pct loss margin

* Bleak outlook as recession saps demand

* Shares fall 3.8 pct in market down 2 percent (Updates shares, adds capital spending plans)

By Marie-France Han and Rhee So-eui

SEOUL, Jan 23 (Reuters) - Samsung Electronics (005930.KS) posted its first ever quarterly loss as its memory chip and display units buckled under the weight of diving prices, and the technology giant faces even more pain as global recession saps demand.

Profits at the world's top maker of memory chips and liquid crystal displays (LCDs) have been mauled by a lengthy downturn in the memory market and a rapid drop in margins for flat screens, along with slowing sales of all consumer electronics.

"It's a big earnings shock, boding ill for other high-tech players around the world," said Lee Jeong, an analyst at Hana Daetoo Securities.

Peter Yu, analyst at BNP Paribas in Seoul, predicted the current first quarter would be even worse.

"Across the board, every major business is going to show quarter-on-quarter deterioration. At the moment, the visibility of a turnaround is very low," he said.

Samsung posted an October-December operating loss of 937 billion won ($682 million), showing the impact of ravaged chip and LCD prices. The figure compares to a year-earlier profit of 1.78 trillion won and was much steeper than analysts' forecast for a 452 billion won shortfall.

Samsung's chip unit, which just two years ago posted an operating profit margin of 31 percent, reported a loss margin of 14 percent, a much larger deficit than expected. The loss contributed to almost 60 percent of the total operating loss.

Samsung also said the oversupply situation in the memory market would continue through the first half of 2009.

"Samsung Elec saw a larger-than-expected loss in its memory chip unit, primarily due to massive falls in prices in October, November and December," said Kim Gee-soo, analyst at Goodmorning Shinhan Securities.

Overall sales at Samsung rose 5.5 percent to 18.45 trillion won but also missed forecasts.

The results came a day after Japan's Sony Corp (6758.T) warned it would post a record $2.9 billion annual operating loss due to sliding demand and a stronger yen, and unveiled fresh restructuring steps to revive its ailing electronics operations. [ID:nT20158]