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Pandora plunges on talk of Apple launching rival service

October 25, 2012: 4:06 PM ET

Shares of Pandora plunged nearly 18% Thursday, following a news report that said Apple was planning to launch a rival Internet radio service next year.

Thursday afternoon, Bloomberg reported that talks between Apple and major music labels had intensified recently. Citing people familiar with the situation, Bloomberg said a deal to launch an ad-supported Internet radio service could be reached by mid-November, with a potential launch date sometime during the first quarter of 2013.

The news triggered a single-stock circuit breaker, which is intended to limit violent swings in stock prices. Within five minutes, Pandora's stock resumed trading only to trigger a second circuit breaker just minutes later. The stock started trading again at 3:40 pm ET.

Shares of Pandora (P), which were barely changed for much of the day, ended down 11.7%.

Related: iPad mini launched at Apple event

Earlier this week, Pandora's stock got a boost after Apple executives made no mention of a competing service when they announced the iPad mini and a new lineup of Macintosh computers. Pandora's stock rose 8% that day.

After the closing bell, Apple (AAPL) posted mixed fourth-quarter earnings. The company's forecast for next quarter, however, was a blockbuster. Apple said it expects sales of around $52 billion, up 12% from last year's holiday quarter.

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Catherine Tymkiw
Catherine Tymkiw
News Editor CNNMoney

Catherine Tymkiw is a news editor at CNNMoney where she helps oversee breaking news coverage and futures planning. Previously, she was the investing editor. Prior to joining CNNMoney, she was the online editor at Crain's New York Business and has nearly two decades of reporting and editing experience. She tweets @ctymkiwcnn

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