This is a very casual slang expression. It means something similar to "great" or "wonderful". It's used mostly by people in their mid-30's or younger, but it doesn't have any negative associations.

"Sweet!" can be used by itself like in the example above. Or it can be used in a sentence:

That is sweet!

By the way, this use of "sweet" is different from when you call a person "sweet". For example:

Thanks, that's really sweet of you.

You are so sweet.

When you call a person "sweet", it means that they're nice, kind, thoughtful, and so on. When you call a thing "sweet", it means you're excited about it.

This phrase appears in these lessons: