It's a very common and informal expression used to express excitement, approval, or admiration.
Here are some examples:
* "¡Que guay! Me encanta tu nuevo coche." (How cool! I love your new car.)
* "Que guay que te vas de vacaciones a la playa." (That's awesome that you're going on vacation to the beach.)
* "¡Que guay! Ganaste el concurso." (How cool! You won the contest.)