I think this past quarter they won't lose so much money, maybe even make a bit.

Reasons:

- In the same quarter last year they had a break even result (yeah a $57m profit is pretty much break even for a business of this dimension).

- The PS3 should be quite a lot cheaper to make right now, BUT exchange rates should about compensate for that. However, exchange rates got a bit better since late 2008.

Regarding your three points I would say number 1 shouldn't be that expensive to affect the numbers much, and the same for number 3. Number 2 could have a negative impact, but that's hard to know.

Another thing which should have a negative impact is the PS2 price cut and lower PS2 software sales, but I still think any loss won't be too big. I'll say a $200m loss to a $200m profit.

well, those points are just small things... but I'm sure there's plenty of other things I don't even know about.
I mean what would you do as a company if you were holding back due to low profits?
More work spent on updates
Contracts for streaming video deals
EyeToy R&D
Opening up new divisions and dev groups
Server expansion

In short, I think they are making money on ps3 now, and because of this, they will be spending a lot of money to stay in the black, even if that means spending one more quarter in the red to prepare for the future.

Manufacturing costs that Sony refers to when they say they will be breaking even soon are simply referring to component costs, not labour costs. They also usually don't refer to additional expenses such as the controller costs, packaging & shipping costs either. Even the 3rd parties that do estimates of cost are simply based on the components used.

That's why breaking even on a console means little when you have staff and infrastructure to pay for as well. Same goes for software development too. A game budget may have been $x million, but if it doesn't turn a profit then who pays the bills for the rest of the company to operate?

I don't think staying in the black for long is part of their plans either... They need a big price cut fast, otherwise they'll miss their shipment forecasts by a huge amount.

The PS3 is obviously improving in terms of profitability, but much of that is cancelled out by PS2's decline, and the need for big PS3 price cuts.

Interesting points. I think they will post a loss as well, but it should narrow a bit. I think that they have lowered the costs to produce the PS3 and the fewer sales actually help Sony at this point.

@infamy
I'm really not trying to dispute you, but I'm really interested if you have the breakdown on it.
Usually when determining the profit of a product you take the revenue and subtract the costs. Sony has always used the words "profitting on the ps3" rather than "revenu-ing". Maybe it's their own choice of words that is the problem, but to my knowledge, the profit of a product includes the direct costs of it... which is why we say things like "sony makes 20-30$ per 1st party game" (Which includes a cut from Dev costs, marketing, distributiona dn such)

What did they add?

@NJ5
yeah I agree there man. I think it will be perfect timing in a few months, before Christmas, that they release slim for 400$ and drop the price of the regular to 300 or 329 or something.

@dbot, they added SCE to vaio and walkman

maybe sony is actually making a profit with all three of their systems. I think every1 has forgot about software royalties which bring in quite a bit of money. Also increased spending could mean they actually have the capital to pay for it and that capital would come from profitable systems. Really there is no proof that the ps3 still isnt making a small profit on each system sold.