How computers understand the *meaning* of words, not just the spelling.
Because words are now numbers, we can do math with them.
The most famous example is:King - Man + Woman = Queen
If you take the numbers for "King", subtract the numbers for "Man", and add the numbers for "Woman", the result is almost exactly the numbers for "Queen".
This proves the AI understands the concept of gender and royalty, not just the words.