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This video tutorial demonstrates how to reduce the size of an Excel file without losing data. It is essential to save a copy of the file before making any changes. The first step is to compress picture sizes in Excel by selecting the picture, going to picture format, and choosing compress under adjust. Different options for compression are available, such as reducing picture format for printing. An alternative method is to go to file, options, advanced, and adjust image size and quality settings to ensure images are always compressed. This helps reduce file size without compromising image quality.