On the P'unk Avenue blog there's a recent post from Tom Boutell looking at optimizing PHP applications and how you can cope with the possibility of "Serious Traffic" that might come your way.
PHP is easy...as programming languages go, that is. You can build sites in a real hurry. [...] Still, sooner or later success catches up with you and you want your site to cope with Serious Traffic...or cope with moderate traffic on a cheap virtual machine...or at the very least, not be dog-slow with just a handful of users on the system.
He mentions things that can slow down the application (like timeouts on web server connections or not optimizing the site with a "thin" server for non-PHP requests). He mentions the alternative PHP cache (APC) as one possible way to help, some tips on making your Apache server more efficient and pushing those lighter requests off to a smaller, built-for-speed server using FastCGI.