Es una destrucción total, un desastre o un fracaso, algo así. También es un término utilizado en el deporte del surf. Es cuando un surfista trata cabalgar una gran ola, pero él termina siendo totalmente derribado. Un intento fracasado, y muy humillante para el surfista.

Depends on the context; to destroy or be destroyed completely is the most common.

As others have stated, it can relate to surfing. It could be a car crash, but a child could also say, "I wiped out" if they crash their bicycle or fall off a skateboard. Someone can be wiped out financially, meaning they've lost all of their money. A person can say, "I'm wiped out" meaning they're feeling very tired or exhausted.