Simply put, gears alter the relationship between torque and speed.
Most cordless screwdrivers only have 1 gear but some models have 2 or 3.
Single-gear screwdrivers
Cordless screwdrivers with 1 gear only have one speed range, which means that using the speed control trigger you can go from 0 to the maximum RPM but no higher.
RPM stands for Rotations Per Minute. One complete turn of the chuck = 1 rotation
The cordless screwdriver on the left has 1 gear, and has a maximum speed of 200 RPM. Using the speed control trigger you can vary the speed in the range of 0-200 RPM but no more.
Models with 2 or more gears will have more speed ranges, and will allow you to do a larger variety of screw-driving and drilling tasks.
Multiple-gear screwdrivers
Some cordless screwdrivers have two or more gears.
For example, the one on the left has 2 gears:
1st gear: 0 – 200 rpm
2nd gear 0 – 600 rpm
The gears in a cordless screwdriver work in much the same way as they do in a car.
Putting the cordless screwdriver in a low gear means it will operate at a slower speed but it will deliver more torque (turning force).
Putting the cordless screwdriver in a higher gear means it will operate at a higher speed but will deliver less torque.
Select a higher gear when less torque is required (when working with softer materials or smaller screws).
Select a lower gear when more torque is required (when working with tough materials or larger screws.)
Which should I choose?
A cordless screwdriver with more gears can complete a wider range of tasks and will allow you to really fine-tune the amount of torque and speed being delivered at one time.
However, the more gears a tool has, the more expensive it is likely to be.