The cutter trims the valve guide and cuts the guide OD for the seal of your choice. You should know the OD your preferred seal requires before you buy the cutter. For me it was 0.625 so I could use stock late LA valve seals.

If the cutter is any good it'll have carbide cutting tips. Actually I've never seen one that didn't. These stay sharp a long time but crack easily. I dropped the cutter attached to the pilot which slid down the valve guide. The cutter cracked, part broke off. So now when I cut down a guide there is a little 1/32" thick cylinder of the original guide that I have to trim off with a grinder.

R.