Facebook began using HipHop (their PHP compiler) at a time when they already had...

copenhagencoder on Feb 9, 2012 | parent | context | favorite | on: Why I Don’t Host My Own Blog Anymore

Facebook began using HipHop (their PHP compiler) at a time when they already had 200 million users and a website that by definition is very hard to cache. So in other words, PHP without Facebook's custom compiler was able to handle a site having 200 million frequently returning users. I'd say that's pretty good.

Sources: http://www.h-online.com/open/news/item/HipHop-Facebook-s-PHP... and http://en.wikipedia.org/wiki/Facebook

gridspy on Feb 9, 2012 [–]

But it wasn't all running on a single VPS.

If OP had thrown more hardware (and hardware costs) at the equation his problems would have reduced.