I’m troubled by a lot of the preceding discussion, as there are a number of somewhat vague and off-tangent answers in the mix. It’s been my experience that most users have no idea what a PDF file is and have absorbed a lot of weird notions from casual use, alternate software and, well, confused discussion.
PDF and AI (Adobe Illustrator native file format) and EPS (the grand-daddy of both, an Encapsulated Postscript file) are almost the same thing in most ways. A true PDF is an evolved and encapsulated Postscript file, which contains vector and font information that Reader and other tools use to reconstruct the document on the fly - just as a Postscript printer takes PS instructions and builds a page to print, Acrobat Reader takes very similar, highly congruent instructions and renders the page image.
This kind of PDF is enormously compact and even a complex form can be stored in 40-50kb, because it’s NOT a bit-image and the vector-based imaging of Postscript and its heirs is inherently very, very compact. It does put the load on the output device, be it a printer or a workstation, because it does take computational load to read those vector instructions and render the page at whatever maximum resolution the device is capable of. (As someone pointed out, though, this computation load is trivial for pretty much all computers newer than 10-12 years old, and not too bad even for old Pentium boxes.)
The confusion comes in when PDF is used as a container for scanned images. In that, it’s only slightly better than Word (which is effing abysmal; nothing could make me put my head down on my desk and cry like some five-page document scanned into a 6MB Word file that would fault, break and corrupt because of gamma-ray reflections from the Moon.) Too many people, I think, see and understand PDF as a variant of JPEG or TIFF another scanned image/document form.
When you get a PDF that’s basically a scanned image, it is a variant of JPEG or BMP or TIFF… encapsulated in a PDF framework. It’s not Acrobat’s fault that the file is gigantic and slow to open and slow to manipulate and most of the tools will not work on it because it’s not a live document, with vector-rendered layout and text. That is also an entirely secondary use of PDF - like every other document transferred using PDF, it’s probably the best way to get the material to another user or many other users and be sure that they will be able to open, view, print and maybe manipulate it, without having to rely either on a common software platform (like a compatible version of Word, say) or leave it up to the recipient to figure out which tool is best to open, say, a JPEG scan and use it as a document.
The ability to create a compact document that can be opened nearly perfectly by any other user with nothing more than Acrobat Reader is a huge boon. (PDF is also the basic file format for nearly all graphic arts file submission, which eliminates past eras of endless hassle with file compatibilies, font matching, “packaging” file sets for transfer, etc. Nearly ANY program can “print” to PDF; nearly any computer that can run Reader can open and view that file. It’s a fraggin’ miracle from the viewpoint of those of us who used to have to spend hours getting a file to a print shop and ensuring it was received, processed and printing correctly.)
PDFs compress in two ways. If the file is “pure PDF” - vector and font info only - then using the various compression and file-reduction steps do things like strip out excess information, reduce font sets to only those characters used, trim images to actual displayed size, etc. This is a good thing if you want a final-final file of minimum size; further up the chain, you want to leave a lot of that “excess” info in place to allow more sophisticated print control, file manipulation, etc.
If the file has raster images in it, or if the whole thing is just a raster image embedded in the PDF framework, compressing it is just like compressing any image file. You can only do it by going to a very high-efficiency lossless compression algorithm, which PDF pretty much uses by default (meaning there’s very little to be gained by using additional compression), or you choose a lossy method and the image quality will degrade proportionally. It’s just like taking a picture from your camera and reducing it from 3-4MB to 140k; it’s going to lose a ton of detail and quality that can never, ever be regained from that copy.
TL;DR vesion: PDF represents two completely different file formats. One is vector-based and both inherently infinite-resolution and very compact; the other is encapsulating a raster image, which is subject to all the problems of tradeoffs between image size and image resolution/quality. They are not all one thing.
True story: I worked for years with a guy who produced a highly-regarded niche journal. Because had once, long ago, worked briefly in a newspaper print room, I couldn’t tell him anything about publications and graphics. He would laboriously lay out each edition (in WordPerfect, and this was not 2001), then print out the final version and carefully scan the pages into a PDF file, which was often 10MB or more. Now, he had a thousand reasons to keep these files small, easy to exchange, flexible and at least lightly manipulatable… none of which apply to scanned-page PDFs. Absolutely no amount of trying to explain that he could very easily “print to PDF” and produce a vastly superior result - 1/50th the size, to start with - would convince him that “PDF” worked any other, or better, way.
It does.