DocumentBuilderFactory factory = DocumentBuilderFactory.newInstance();
DocumentBuilder builder = factory.newDocumentBuilder();
Document document = builder.parse(new File("example.xml"));

XPath xPath = XPathFactory.newInstance().newXPath();
XPathExpression expr = xPath.compile("//text()[normalize-space()]");
NodeList nodeList = (NodeList) expr.evaluate(document, XPathConstants.NODESET);

for (int i = 0; i < nodeList.getLength(); i++) {
    Node node = nodeList.item(i);
    node.setTextContent(node.getTextContent().trim());
}

Transformer transformer = TransformerFactory.newInstance().newTransformer();
transformer.setOutputProperty(OutputKeys.INDENT, "yes");

DOMSource source = new DOMSource(document);
StreamResult result = new StreamResult(new File("output.xml"));
transformer.transform(source, result);