Most of the time the update contain a completer replacement for the program. So the download it the same as if you just install it for the first time. Configuration files are kept so you setting in the app is still there after you update it.
On larger program like operation system you can have updates that is differential so you only changes stuff that is changed but that increase complexity and for a mobile app that is just a few megabytes it is not worth it.
There’s two different ways of updating stuff. Think of it like fixing errors in a book. One way is to provide errata, a sort of list of things like “replace the second sentence in the fourth paragraph of the third page with this new sentence”. The other is just to send out a new copy of the book with the errors fixed. The first way usually takes less space (which means less data when updating an app), but the second version works regardless of what previous version you had, so most places provide updates that way.
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