EDS (NYSE: EDS) may have invented the IT outsourcing business model, but that market's gotten crowded these days, and growth is hard to come by.

Last quarter, the company grew sales at a tepid 2% year over year, and even that anemic improvement came from acquisitions and currency exchange effects. Excluding those items, you'd get 3% of organic shrinkage.

Over the past year, EDS has languished among the laggards of the IT services sector, along with Infosys Technologies (Nasdaq: INFY) and Wipro. That's why I'm not terribly shocked to see another disappointing quarter, even after good numbers from IBM (NYSE: IBM) and Accenture (NYSE: ACN).

The loss of one large contract from Verizon (NYSE: VZ) was the biggest reason for the disappointing revenue. It would be unfair to say that EDS wasn't diversified enough, though. After all, the company sells support contracts for everything from copy machines, data networks, and server hardware to databases, Web servers, and business management software. EDS counts both Oracle (Nasdaq: ORCL) and its archrival SAP AG (NYSE: SAP) among its direct partners, for example.

But its international customer base could probably stand to expand a bit. Domestic sales make up 44% of EDS's fourth-quarter revenue. For both IBM and Accenture, North and South America together composed just 40% of sales. EDS saw domestic sales drop 8% year over year, with 28% lower operating income to boot, while business in every other part of the world increased

It's hardly "game over" for EDS. Its cash flows are strong and growing, and management says that the incoming order volume still looks good. That's why a 30% share price drop in just more than six months seems a bit harsh to this Fool. If EDS can get its international game going properly, there's no telling where this stock could go. But it will take a long time for that to happen -- if it ever does.

Further Foolishness:

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Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure has a global profile like no other.