Looking through the current kernel config used by VyOS it seems like kernel modules wont be compressed during compilation?

https://github.com/vyos/vyos-build/blob/168a86e1dba06d4f464a23cc7f1b79003cb777e9/packages/linux-kernel/arch/x86/configs/vyos_defconfig

CONFIG_MODULE_COMPRESS_NONE=y
# CONFIG_MODULE_COMPRESS_GZIP is not set
# CONFIG_MODULE_COMPRESS_XZ is not set
# CONFIG_MODULE_COMPRESS_ZSTD is not set

Suggestion to enable xz compression of kernel modules:

# CONFIG_MODULE_COMPRESS_NONE is not set
# CONFIG_MODULE_COMPRESS_GZIP is not set
CONFIG_MODULE_COMPRESS_XZ=y
# CONFIG_MODULE_COMPRESS_ZSTD is not set

If the compression would save the same ratio as below ref (about 63% smaller filesize) it would mean that the VyOS image regarding kernel modules could shrink from about 116MB down to approx 43MB (a saving of approx 73MB)).

Since filesystem.squashfs is already compressed using xz this might mean that the resulting iso not necessary would shrink as much as 73MB.

Ref:

https://github.com/raspberrypi/linux/issues/4966