Impression share is the percentage of the impressions you were eligible for that you actually won, on Google Search and Shopping. Lost impression share is split into share lost to budget and share lost to rank, which tells you exactly what is capping your reach.
What it tells you
Impression share is impressions ÷ eligible impressions. If it is 60%, you are missing 40% of the auctions you could have shown in. The value is in the two lost-IS columns: lost to budget means you ran out of money, lost to rank means your Ad Rank was not high enough.
How to act on it
Lost IS to budget on a profitable campaign is a signal to scale spend. Lost IS to rank points at bids, Quality Score, or relevance. Chasing 100% is rarely worth it, since the last slices of impression share are the most expensive and often the least qualified.