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Note that it was an analyst (Richard Doherty) who said this, not a Sony representative.

Still, I don't find it that hard to believe. What have they done to reduce costs?

-Earlier this year, they moved from 90nm to 65nm Cell chip production. This was estimated to bring the loss down below $200.
-They removed the Emotion Engine, and the 32 MB of RDRAM that went with it, from the PAL version of the console. This was estimated to save them around $30. This modification is now also being made to the US consoles, and probably has been for some time as they've been stockpiling 80 gig machines.
-A variety of improvements in the Blu-Ray manufacturing process reduced costs by around $100 for all BD players, including the PS3. (Sorry, couldn't find a source on this one, but it was about a month ago and most BD players dropped as a result). I'm not sure if this was in addition to the improvement in BR diode supply mentioned by someone else, but if it was then the savings were even higher.

That's a minimum of a $170 cost reduction over what they launched at, which would bring the loss down to $70 per unit. Now, add onto this the usual savings that come with streamlining/increasing production and decreasing failure rates, and I think it's entirely plausible that the PS3 had turned profitable, at least outside of Japan.