Apple's newly announced high-end chip for the new MacBook Pro, the M1 Max, can support up to three Pro Display XDRs and a fourth 4K TV display all at the same time, a significant jump in support compared to the single display support that the M1 chip provided.
The M1 Pro chip supports up to two Pro Display XDRs alone, while the higher-end M1 Max chip extends support to an additional Pro Display XDR and a 4K TV. To support this, the new 14-inch and 16-inch MacBook Pros feature three Thunderbolt 4 ports and an HDMI port.
Overall, the new MacBook Pro with the M1 Pro chip supports up to two external displays with up to 6K resolution at 60Hz, while the new MacBook Pro with the M1 Max chip supports up to three external displays with up to 6K resolution and one external display with up to 4K resolution at 60Hz, according to Apple's tech specs.
Apple announced completely redesigned 14-inch and 16-inch MacBook Pros models today during its "Unleashed" event. Be sure to catch up on all of the announcements right here on MacRumors.com.
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Supporting many external displays is definitely a necessary addition but the lack of HDMI 2.1 is unfortunate. You have a 120hz built-in screen but won't be able to output 4k 120hz over HDMI to a TV for example.