Palm Has Half of the Business Plan Puzzle in Place

palm-preAfter listening in on yesterday’s Palm investor call, I came away feeling only half-satisfied. On the one hand, Palm says it’s poised to become cash-flow positive in two quarters. The company ended the last fiscal quarter of 2009 with $255.1 million in cash, even after going through $72.4 million. Sales of the Palm Pre really won’t impact finances until the next quarter, but according to CEO Jon Rubinstein, “Everything is going according to plan.” Palm (s PALM) expects gross margins for the Pre to approach 30 percent over time, which will surely help the bottom line.

On the other hand, the second piece of the puzzle isn’t yet in place. To continue driving demand for the Pre, the Application Catalog needs to be significantly expanded. It’s currently in a beta and holds a meager 30 applications. And there won’t be many more added until Palm gets the Mojo SDK to a wider audience.

That audience is set to expand soon. Rubinstein said that “hundreds to thousands of developers” will gain access to the SDK in the next few weeks. Palm hopes that it will be open to all interested developers by the end of the summer, but admitted it’s still tweaking the toolset. In the meantime, Apple’s (s aapl) iPhone App Store is busting at the seams with some 50,000 titles.

But Palm is betting its future on the webOS platform, believing it will drive the company for the next 10 years and beyond. With a bet like that, it makes sense to proceed in the self-described “controlled and methodical fashion” to get the platform right the first time. Given the ever-growing competition in the smartphone market, there may not be a second chance.