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In the tutorial, the speaker explains how to compress images to reduce the file size. They demonstrate two methods: first, by selecting a picture, clicking on the picture format tab, and choosing the compress pictures option. They recommend selecting high fidelity and deleting cropped areas to further reduce the file size. The second method involves clicking on file, then compress pictures, which automatically compresses all images in the file. Despite making these changes, the file size will not update until the changes are saved.