It fits a local regression model to the data, using a call to the loess() function in TIBCO Enterprise Runtime for R (TERR). This is the call to loess() at the core of the data function's TIBCO Enterprise Runtime for R (TERR) script:
A loess model is a form of non-parametric regression where the regression surface is locally approximated by polynomials of degree 1 or 2. The TERR script's call to loess() uses the function's default polynomial degree of 2, so the data function is using locally-quadratic fitting to generate the regression surface for the heat map and its contours.