Helps the engine run more efficiently by cleaning carbon build-up and other particles. Gets better mpg, more stable idle, etc.. Only really necessary on a dirty engine.
What needs replacing depends on how much carbon build-up there was. Can be just fine after the seafoam, or could need new plugs and maybe even new O2 sensors.
I seafoamed on Friday because of the S/C install, just to get the engine really clean (which it already was really good). I replaced my spark plugs too but just because it was also for the S/C. Ill have all of it on my build tomorrow, and I'll post the seafoam video here then too.