Image source: GoDaddy.

What: Shares of GoDaddy (NYSE:GDDY) rose as much as 12.9% on Thursday morning, driven by a solid second-quarter earnings report.

So what: In the second quarter, GoDaddy's revenue increased 15.6% year over year, stopping at $456.2 million. The provider of technology services, such as domain-name registrations and website hosting for small businesses, reported a GAAP net loss of $11.1 million per share, up from a $71.3 million loss in the year-ago period. Net losses per diluted share improved from $0.46 to $0.11.

But it wasn't all red ink: Free cash flow increased by 9%, to $83.9 million, and adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 26%, to $103.5 million. The wide spread between cash-based profits and GAAP losses stems from large and rapidly changing balances of amortization, depreciation, and deferred sales.

For the third quarter, GoDaddy guided to sales of roughly $470 million, yielding adjusted EBITDA profits near $104 million. Full-year targets for both of these metrics were tightened around the top end of each guidance range.

Now what: GoDaddy's focus on small- and medium-sized business clients is paying dividends. Order bookings are trailing slightly behind revenues, growing at a 14% clip in constant-currency figures. But the average quarterly revenue per user is up 6%, to $125 (as I said, the focus is on small businesses), and the company is still growing its customer list by 8% annually.

Looking ahead, the company is aiming at international growth by adding services in Spanish and several Indian languages. International sales outgrew the domestic division in the second quarter, rising 17.6% year over year, to $119 million. If not for currency-exchange effects, that growth rate would have soared to 25%.