If you see the term "upgradeable" printed on the spec sheet of equipment, it would mean that you can purchase an add-on module, slip it into the equipment and upgrade its functionality. One easy example to relate to is the case with the modern NAD integrated amplifiers. One can upgrade these amps to make them compatible with turntables or cd transports by adding on a phonostage module or dac module.
In another context, enthusiasts may upgrade their gear regularly. This simply means, they either sell off or decommission their existing equipment and go in for equipment which is more widely reviwed and acknowledged to be better than their existing equipment, and in most cases, more expensive as well. An example of this would be to upgrade from a Technics SL3200 turntable to a Technics SL1200 turntable.
The existing equipment is often sold or sometimes traded as part of the deal for purchasing better equipment (considered the upgrade). In some cases, the enthusiast may retain equipment for use as a second system, etc.
The converse of upgrade, which is down-grade, is also possible. It is the reverse of both the above. One can downgrade or downscale equipment by removing modules resulting in less features, or downscale a rig by removing audio components. Downscalling is normally done with change in economic circumstances, social circumstances, listening tastes and styles, etc.