Does Unity compress sprites twice if they are packed?

Hey everyone,

Trying to do some investigation and wondering if anyone knew the specifics on this issue. Basically I have a bunch of sprites that are set to default compression. Sometimes i notice that when viewing them AFTER they are packed in the Unity Sprite Sheet, they looked to be more pixelated then before. So my question is there another round of compression going on with the unity sprite packer? Or is it just gathering the sprites and putting them in one image?

Thanks!