Eastman Kodak will likely lay off 15,000 employees and close approximately a third of its factories by 2006 as it shifts from traditional photography to digital photography.

Already feeling the repercussions of the shift, and the high cost of restructuring involved in the shift, Kodak reported a net first quarter loss of $142 million in 2005 as opposed to $21 million in earnings for the same period last year.

This news sent Kodak’s shares down 8 percent in early trading on Friday. Even ignoring $152 million in exceptional costs, Kodak only posted $9 million in earnings in the quarter, below expectations.

Traditional film sales dropped 17 percent in the United States and 29 percent worldwide in the quarter, although sales of digital products were up by 23 percent. Kodak is in the process of shifting over from traditional photography operations to digital products, health imaging, and high-volume printing.