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In this video tutorial, the instructor demonstrates how to delete or remove unwanted spaces in Microsoft Excel. By pressing Ctrl+H on the keyboard and using the replace function, users can easily eliminate unnecessary spaces from their data. By inputting a single space in the 'find' box and leaving the 'replace with' box empty before clicking 'replace all', users can efficiently clean up their spreadsheet. This simple yet effective method helps to streamline and organize Excel data quickly and easily.