I think it means something like "Hello" or "How are you?", am I right?
- Anybody can ask a question
- Anybody can answer
- The best answers are voted up and rise to the top
In the end, yes it does mean 'Hello', at least in this context. But it does not mean 'How are you?'. You often add the question:
Or you add something stupid like:
(I believe, that your friend will never say that, but imagine the situation you meet a person in a gym, or so.)
Besides greetings, Na is an interjection (Appellinterjektion) and is used in colloquial. Usually, it is placed in front of a short sentence. Na can express feelings like surprise, unhappiness, impatience, ...
Have a look at the DUDEN for more examples.
As the comments point out, in some region of Germany "Na?" has the connotation of Wie geht's? - How are you?, too, without explicitly adding that question itself. You usually will use in that way, of course, just when greeting a person you know well.
In Österreich, welches zum dt. Sprachraum zählt, steht "Na" häufig für "Nein".
Außerdem wird es ermahnend, teils kurz und scharf, in Deutschland verwendet. Wenn die Katze verbotenerweise auf den Esstisch hupft ruft man harsch "Na!" um sie zu verscheuchen, ertappt man das Kind mit dem Finger in der Nuss-Nougat-Crème kann man verständnisvoll-tadelnd ein "Na, na, na" über die Lesebrille raunzen.
Die Em1-Antwort dürfte aber am häufigsten stimmen.
Em1 and user unknown have brought up good points but I'd like to state my experience about the inquiring "Na?":
"Na?" is simply a very short entry to start an unconditional/optional conversation with someone.
You are showing interest in the other person and if they feel like they can talk to you about what is going on or not.
The difference to directly asking "Wie geht's?" or "Was ist los?" is that there is no commitment. Neither do you ask something specific nor does the partner have to engage a full conversation. Furthermore "Na?" also implies that the topic of the conversation is free to be set around what ever is on the partner's mind.
Someone is obviously pondering over something and you ask "Na?" to indicate your interest in the other's current mood/feeling/puzzles.
On the other hand the inquiring
usually implies that one is supposed to recognize something of/about the inquirer (some body modification or achievement). The inquirer is then looking for/expecting some (verbal) praise and recognition.
In my understanding of what your friend means it's the very short colloquial form of
You could reply