A factory reset on an Android phone restores the device to its original software state, as it was when it left the factory. This process erases all personal data, installed applications, and customized settings. An example would be performing this action before selling a device to ensure complete data removal.
The importance of restoring a device stems from several needs. It provides a solution for troubleshooting persistent software issues that cannot be resolved through simpler methods. It also serves as a crucial step in safeguarding personal information when transferring ownership of a device, preventing unauthorized access to sensitive data. Historically, it was used to make device like new.