The sentence uses figurative meanings of three words: where, far, and come. Here, "where someone is" means "the situation someone is in" or "someone's general state of mind. "Here's another example of this use of where in a sentence: "The first few months after the divorce were very difficult for Jane, but she feels good about where she is now. "
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The phrase "how far they've come" refers to progress that the person has made in his or her life, emotional state, abilities, outlook, etc. ( Note that the "they" in "they've" is singular; it refers to the same person that "someone" does in the first part of the sentence. )
Here's another example of this phrase being used with the same meaning: "It's great to see how far these kids have come. When they came to this school, none of them could read and now they all love books!
