Nikon 1 S2 has a
14.2MP 1' (13.1 x 8.8 mm ) sized CMOS sensor and features Expeed 4A processor. On the other hand, Panasonic GX85 has a
16.0MP Four Thirds (17.3 x 13 mm ) sized CMOS sensor and features Venus Engine processor.
One other difference between these two cameras that is worth mentioning is that Panasonic GX85's sensor doesn't have an anti-alias (Low-Pass) filter. Removing anti-alias filter increases the sharpness and level of detail but at the same time, it increases the chance of moiré occurring in certain scenes.
Below you can see the 1 S2 and GX85 sensor size comparison.
As seen above, Panasonic GX85 has a 2.0x Larger sensor area than Nikon 1 S2. Larger sensors give photographer more control on the depth of field and blurry background compared to smaller sensor when shot in same focal length and aperture.