Worm-eaten describes wood, fruit, cloth, books, or anything else that has small holes in it because insects have eaten through it. The holes are the point — you can see them, and they tell you something has been living inside. The word is a compound adjective: worm + eaten, 'eaten by worms'. Note that 'worm' here is loose. In careful biology a worm has no legs, but in this word English uses 'worm' for any small crawling thing that bores holes — beetle larvae, moth larvae, and the like. Most 'worm-eaten' furniture was actually eaten by beetle grubs, not by worms at all. English speakers do not worry about this. The word usually comes with a feeling of age and decay: an old table, an old beam in a temple roof, an old book on a shelf. So people also use it in a stretched, non-literal way, about ideas, systems, or organisations that look solid but are rotten and full of holes inside — 'a worm-eaten empire', 'worm-eaten old theories'. That use is a bit literary; you meet it in writing more than in speech. In everyday talk about fruit, people more often just say 'there's a worm in it' or 'it's got worms'. Always written with a hyphen.