The short generic answer is yes - the extract resides on the Server if it is published as an extract. But the extract still contains a link to the native data source so that it can be refreshed from that source.
Thanks John. Just to clarify, do you know why the upload to server would be so fast if the extract itself is so large?
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When you create an Extract, there is actually a processing of your datasource: It will require downloading the data to your desktop/laptop and reestructure it as an Extract. The downloading may take time depending on how fast your network connection is and how you are connected to the site where the data reside. It will also depend on the amount of data being downloaded, and the complexity of the required conversion.
Publishing the Extract is just the copy of the data extract to the server. It may actually be quite fast, depending on the architecture of your network and how you are reaching the Tableau Server.
Hope this help.
Great explanation, Alfredo!