Samsung Display said Friday that Kwon Oh-hyun, vice chairman and co-CEO of Samsung Electronics, will replace the company’s current chief executive Park Dong-gun.

The display business arm of Samsung Electronics did not elaborate on the reasons for the change, but some market watchers suspect Park was replaced after failing to boost the display business.

Samsung Display posted an operating loss of 270 billion won ($236.4 million) in the January-March period this year. The company attributed the main cause of the profit drop to the low production yield of liquid-crystal displays after the adoption of a new production technology and the decreased margin of LCDs due to competition from Chinese players.

Kim Ho-jung, a spokesman of Samsung Display, said the replacement of Park was “not a castigation or the like.”

“The LCD business will get back on track in the coming months,” he added.

Park, who had led the display manufacturer since December 2013, will move to Samsung Electronics’ device solution division, which oversees the semiconductor business.

“The appointment of vice chairman Kwon Oh-hyun, who also heads Samsung’s semiconductor business, is expected to create synergy between the semiconductor and display businesses,” the Samsung Display spokesman said.

by Kim Young-won (wone0102@heraldcorp.com)