As pointed out by bumidan in another thread, the $3B in losses are at the Game Division level, of which PS3 is part of. $2B in FY2007, and $1B in FY2008, ending in Mar 08. So as he accurately pointed out, PS3 lost all of PS2 and PSP hardware and software profits in FY2007 and in FY2008, PLUS $3B more.
http://www.sony.net/SonyInfo/IR/financial/fr/07q4_sony.pdf
Now with holiday sales of the past year, Sony says that was enough to make the last half profitable. In other words, the PS3 losses did not completely wipe out the holiday profits of the PS2 and PSP. If they can do as well in reducing PS3 losses this year as they did last year, then the PS3 losses will match up with the PS2 and PSP profits, allowing the Gaming division to break even for the entire year.
While the manufacturing cost of $350 being floated about is less than the retail sales price, there are a lot of non-manufacturing costs as well. Overhead cost, advertizing, freight charges, finance costs (where the retailer buys the PS3 from Sony but doesn't have to pay the invoice for 45 days or so).
For those wanting to know the liability side of Sony, $40B in current (
Torturing the numbers. Hear them scream.
