Well, PDF is a scalable format so whether or not you see these pixels depends on your output resolution, that is the screen resolution and zoom level of your PDF viewer or the paper size and dpi number of your printer. Both can be insanely high (you can apparently buy a printer with 4800 dpi in one dimension for under 100 €/$/£ and going to 6400 % in Adobe Reader on a 4K or Retina display also needs some serious resolution in your non-vector graphics).
I mean, remember, this was native screen resolution once:
Long story short: TeX can't know what resolution you are going to need, only you can (and sometimes that's difficult enough to decide). If say you only need 72 dpi for screen reading (please don't but it's your decision) then multiply that with the size of your image in inch and you know what to tell gimp or whatever software of your choice (see the comment by Werner). Also, smart usage of JPEG parameters as JLDiaz suggested might be a very good idea.