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This video tutorial demonstrates how to reduce the size of an Excel file without deleting data. It is advised to save a copy of the file before making any changes. The first step is to compress picture sizes by selecting the picture, going to Picture Format, selecting Compress under Adjust, and choosing the desired compression option. An alternative method is to go to File, click on More, then Options, followed by Advanced, and scrolling down to Image Size and Quality. Ensure the "Discard editing data" option is selected and adjust the PPI to reduce file size.