Napster Takes On Apple

Shares of Napster jumped 7% Thursday after the company boosted revenue guidance.

The company formerly known as Roxio said it now expects quarterly revenues of $15 million, $1 million above analysts’ estimates. Napster did not discuss earnings guidance; analysts are looking for a loss of 63 cents a share in the quarter.

Napster’s good news was bad news for Apple , which saw its shares shrink by 5% on news of its digital music rival’s success. With competitors ranging from Napster to Wal-Mart to Sony and Microsoft taking note of the digital music market, investors are wary of any sign that Apple’s dominant position could be vulnerable.

The broader market closed mixed ahead of Friday’s February jobs report. Strong retail sales boosted blue chips despite another rise in oil prices.

The Nasdaq lost 9 to 2058, the S&P 500 rose fractionally to 1210, and the Dow added 21 to 10,833. Volume rose to 1.62 billion shares on the NYSE, but declined to 1.92 billion on the Nasdaq. Advancers led 17-15 on the NYSE, while decliners led 16-14 on the Nasdaq. Downside volume was 52% on the NYSE, and 66% on the Nasdaq. New highs-new lows were 198-23 on the NYSE, and 100-49 on the Nasdaq.

After the close, Dell boosted its share buyback plan, and Sonus delayed its earnings report while the company addresses weakness in its financial controls.

During the day, chip stocks fell 1% on an industry report that sales declined 0.5% in January from December. The Semiconductor Industry Association called the results encouraging and said that inventory problems have largely been resolved.

Micron lost 2% on a Merrill Lynch downgrade and competition from Intel .

Blue Coat and Sanmina surged on upgrades.

Drugstore.com soared 31% after raising $26 million in a private sale.

Cablevision slumped 5% on a board shake-up.