hook_update_N is a hook used to run code during database updates. It runs when you execute drush updb or visit update.php after deploying new code.
The N in the name is a sequential number indicating the update’s order. Each update function has a unique number, typically following a convention that encodes the module’s major version and an incrementing counter.
Use update hooks to modify configuration, migrate data, or run other changes that need to happen when updating the site. For example, if you add a new field to an existing content type, an update hook can populate it with default values for existing content. Update hooks are essential for keeping deployments smooth, because they ensure all environments run the same transformations in the same order. Write them carefully and test them thoroughly before deploying to production.