At elevated altitudes there is less oxygen in the atmosphere than at sea level. Less oxygen means lower combustion efficiency and less power output. As a general rule, power output is reduced three percent for every thousand feet above sea level.
On carbureted engines, re-jetting for high altitude does not restore lost power, it simply corrects the air-fuel ratio for the reduced air density and makes the most of the remaining available power.
The most important thing to remember when re-jetting for high altitude is to reverse the jetting when returning to sea level. If the jetting is left lean when you return to sea level conditions, the correct air/fuel ratio will not be achieved and possible engine damage may occur.