Companies selling their gaming consoles at a loss out of the gate is nothing new, and it something Sony is still facing since the PlayStation 3 launched in November of 2006. Reports are now coming in however that Sony may be able to begin turning a profit on its hardware beginning as soon as this August.

Nikko Citigroup has upgraded their rating on Sony with the expectation that the company will be able to begin breaking even on the cost of the PS3 much sooner than originally anticipated. While currently selling the PS3 at a loss, Sony CFO suggested that they could begin breaking even sometime during the second half of the year.

This cost reduction is speculated to be related to Sony switching to a sub-65nm cell processor, sub-90nm RSX graphics chip, or maybe even both seeing as how these miniscule chips are much cheaper to produce. In regards to this, Sony has stated on several occasions that the PS3 would finally be able to break even once the costs on both the Cell and PSX chips have gone down.