So good that nothing else comes close. It is a compliment word, used for skill, quality, beauty, success — 'her knowledge of the subject is unmatched', 'a view unmatched anywhere on the island'. The logic inside it is a small competition: to match something is to equal it, so if nothing has matched it, it stands alone at the top. That makes it stronger than 'very good' and roughly as strong as 'the best', but with a nicer sound, because it praises by saying what others failed to do rather than boasting outright. It belongs to fairly formal or written English — reviews, advertising, speeches at retirements — and would sound grand in casual chat. Two other uses exist and are quite different: 'unmatched' can simply mean not paired up, as with socks or gloves that have lost their partner, or data records that did not find a match. Context tells you instantly which one is meant, since the praising sense almost always attaches to a quality, and the pairing sense to countable objects. You will also meet 'unmatchable' and, with the same meaning, 'unrivalled' and 'unequalled'.