A “delay” refers to a deferred cancel (usually). As such, it can be required for the cancel to happen (e.g., if the buffer doesn’t hold the input long enough), or for a desired effect (e.g., a combo requires it). Thus, we have two common definitions:
In lots of cases, it can be used in general conduct.
If your normal move is blocked, then if you don’t cancel as quickly as possible, you may cause your opponent to think you have made them an opening, tempting a counterattack attempt; when their blockstun comes undone, if they advance, you may already be ready to hit them with a projectile or something due to your delay.
Using this, you will raise your chances of more safely being able to use patterns that aren’t actually cancels, or use, say, a teleport move after a normal move.
Delays can also be useful in combos.
For example, let’s say you were using a 2-hit launching move via an add-on input (remember, just an example). By delaying the timing of said input to right before you are forced into a recovery, you could get the second hit to... well, hit.
In The King of Fighters ’97 and later in the same series, canceling from a normal move into a command move may change the command move’s properties, but the technique of delaying the cancel can allow some of these to be done without the properties changing.
Also, moves that would become uncancelable may be done cancelably this way.