It's how many people on your instance subscribed to the community I think
this post was submitted on 15 Aug 2023
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Others explained already. I’ll add that you can see communities’ stats across all instances, including total subscribers, at https://lemmyverse.net/communities
I think how it works is It shows you number of subs from your instance, not total. Unless the community is hosted on your instance, in which case you see all subs.
Data is loaded from your instance. If your instance only started to federate when a community already had like 500 subs, it won't know those existed and start counting anew on your end.
It's a limitation of our current federation solutions and the reason that many clients will offer an option to load this data directly from the instances they originate from.