Microsoft released a new feature within the settings of your Teams client. If you like optimizing space in your chats you are now able set this to compact mode.
By default the setting is set to comfy mode.
Comfy mode
Compact mode
Personally i tested this feature (Compact mode) for at most one hour, this is not the ideal chat view for me.
This feature is not (yet) working on iOS, Android, FireFox and Safari.