There are basically two kinds of restructuring in the corporate world. The first is basically smoke and mirrors designed to fool investors into thinking management is trying to fix a business, when it's actually taking charges and firing employees just to cut top executives a few more fat paychecks. The second kind involves managers actually making tough decisions to make the company more competitive in the future. While AdvancedMedical Optics' (NYSE:EYE) current performance looks a little messy, I believe their restructuring efforts belong in this second, better category.

The company's fourth quarter wasn't great. Surgical product sales were essentially flat without the inclusion of the acquired VISX laser correction business, as the company phased out older products. Same goes for the eye care business, where a roughly 25% drop in sales was mostly due to product phase-outs and poor Japanese sales.

What's interesting, though, is that profitability didn't fall off as much as you might expect. The gross margin fell by only about 100 basis points, and operating income (excluding a restructuring charge) was actually up 28% year over year. I would argue, then, that if the company can ignite the top line and continue the transition to newer (and presumably more profitable) products, there could be some real operating leverage here.

Fools should monitor three key issues here. First, will AMO be able to gain its fair share of the intraocular lens market in competition with Alcon (NYSE:ACL)? Second, what will the overseas demand for laser vision correction be? Third, will the company's efforts to improve its Japanese operations be enough to boost profitability?

If AMO can answer those questions satisfactorily, a couple of rough quarters right now won't seem so bad in a year or two.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).