Literally, it means killing, like a vampire slayer is someone who slays vampires.

However, it gets used like killing does. "She KILLED that performance! WHOO!'

Although, oddly enough, I only see "slay" used like this in reference to Beyonce. I have no idea why. My friend who loves Beyonce keeps posting and reposting stuff using "slay" like that whenever Beyonce has a major performance or other widely publicized thing. Was it in one of her songs or something? I don't know.

Fun fact: He barely uses his twitter and facebook. Most of the time it's his friends messing around (he gave them the password)