It tells you for how long the time displayed by the watch is valid. If a watch loses ten seconds per day, in a month it will be about five minutes off.
The objective is to minimize this number as much as possible. The open source sensor watch has a temperature sensor and software which turns it into a temperature compensated quartz watch. Mine loses time every year instead of every day or every month.
Practically speaking, unless you only own a single mechanical watch you really only care about the per day loss.