Earlier today, Sony released their 2nd quarter financial results.  Despite selling record breaking amounts, their Network and Product Services division(which includes their games division as well as Viao and Walkman divisions) still lost over $600 million.  Part of that was attributed to the fact that Sony still loses money on each PS3 sold, despite speculation that pointed to the opposite direction.

During an overseas investor call, Sony Chief Financial Officer Nobuyuki Oneda revealed that the cost of manufacturing the PS3 was a bit above 10% more than what they make at retail, which would mean the system costs roughly $330 to build.

"Within the year, [the manufacturing cost] could be in the single digits. We'll be able to reach profitability at some point in the next term." Oneda told investors.

Since launch, the PS3 has sold at a loss.  The fact that Sony could potentially begin making money from the console next year is great news for them, especially with their hemorrhaging NPS division.  To put the severity of Sony's situation into layman's terms, one more term in the red and the PS3 will have essentially eatten up all the profits made by the PS1 and PS2 over the last 10 years.