The ESP8266 has on-board processing and storage capabilities that allow it to be used with sensors and other application specific devices through its GPIOs with minimal development up-front and minimal loading during runtime. Its high degree of on-chip integration allows for minimal external circuitry. The entire solution, including the module, is designed to occupy minimal PCB area.

The processor itself is an xtensa chip; use that tag for questions about Xtensa assembly language, ISA details, and other low-level CPU things, not about peripherals or SDK problems.

The chip features:

• SDIO 2.0, SPI, UART
• 32-pin QFN package
• Integrated RF switch, balun, 24dBm PA, DCXO, and PMU
• Integrated RISC processor, on-chip memory and external memory interfaces
• Integrated MAC/baseband processors
• Quality of Service management
• I2S interface for high fidelity audio applications
• On-chip low-dropout linear regulators for all internal supplies
• Proprietary spurious-free clock generation architecture
• Integrated WEP, TKIP, AES, and WAPI engines
• 802.11 b/g/n
• WiFi Direct (P2P), soft-AP
• Integrated TCP/IP protocol stack
• Integrated TR switch, balun, LNA, power amplifier and matching network
• Integrated PLLs, regulators, DCXO and power management units
• +19.5dBm output power in 802.11b mode
• Power down leakage current of <10uA
• Integrated low power 32-bit CPU could be used as application processor
• SDIO 1.1/2.0, SPI, UART
• STBC, 1×1 MIMO, 2×1 MIMO
• A-MPDU & A-MSDU aggregation & 0.4ms guard interval
• Wake up and transmit packets in < 2ms
• Standby power consumption of < 1.0mW (DTIM3)

There are some companies developing modules mostly named like ESP-01, ESP-02, ... ESP-12. Every module has different capabilities and PCB layout.

The modules based on this chip can be programmed with some development tools including Eclipse, CodeBlocks, Arduino(1.6.5) etc. Modules can host different firmwares including NodeMCU. With NodeMCU firmware the chip can parse and execute Lua scripts.