Xara Web Designer will automatically select the best format to export a graphic when exporting your website. You can however manually specify the export type.
Select an object in your web page and open Web Properties from the Utilities menu, then click on the Image tab.
You can force the graphic to be exported as a JPEG, which is best for photos, as well as alter the image quality. You can also force an image to be exported as a PNG which is best for graphic.