The situation this actually solves
It happens constantly: a client sends over their logo, but the only file they have is a PNG someone screenshotted years ago, or exported once at a small size for a website. Now you need that same logo on a banner, a vehicle wrap, or printed at a size where a fixed-pixel image would turn into a blurry mess. What you actually need is a vector version — and if the original design file is genuinely lost, tracing the PNG back into vector paths is often the only realistic option left.
This is fundamentally different from just "converting the file format" — a PNG traced into an SVG isn't the original artwork restored, it's a new vector approximation built by analyzing the pixels that exist and reconstructing shapes from them.
How the tracing actually works
The process looks for distinct regions of color in the image and draws smooth vector outlines around each one, then layers those shapes together into a proper SVG. A colors setting controls how many distinct regions it looks for — fewer colors produce a simpler file with bolder, cleaner shapes, while more colors try to capture finer gradations at the cost of a larger, more complex result with more individual paths.
For a typical flat-color logo, this works remarkably well — the output can be genuinely hard to distinguish from a hand-built vector, and it will be dramatically smaller than the source PNG while scaling perfectly to any size.
The one thing this can't do well: photographs
This is worth being direct about: tracing a photograph produces a mess. A photo has thousands of subtle, gradual color transitions rather than clean flat regions, so the tracer ends up generating an enormous number of tiny fragmented paths trying to approximate something that was never meant to be represented as flat color shapes. This isn't a limitation specific to any one tool — it's an inherent mismatch between how photos and vector graphics represent color, and it applies to any vectorization approach.
If what you're starting from is a photo rather than a logo or icon, vectorizing it isn't the right move at all — a higher-resolution version of the photo itself, or accepting it as a raster image, is the realistic path forward.
Getting a clean result on the first try
Start with the highest-resolution PNG you can find of the logo — tracing amplifies any blur or compression artifacts in the source, since the tracer has to guess at edges that aren't crisp to begin with. If the result looks messier than expected, try lowering the color count first; a logo that looks like it has 4 colors sometimes actually has 15 once you count anti-aliased edge pixels, and reducing the count forces the tracer to simplify those edges into clean shapes instead.