Under Frontstage files in the Backstage, you manage every image your public website can use — your logo, page hero photos, text-section photos, and full photo albums.
Wherever you're asked to pick an image elsewhere in the Backstage — a page's hero image, a text section's photo, your logo in Site settings — you're browsing this exact same library through a small picker window, so anything you upload here is immediately available everywhere else.
A Photo gallery section (see Frontstage content) points at one folder here — you pick it from a dropdown when editing the section. Every subfolder inside that folder then shows up as its own album on the website, with its own cover photo and photo count; the images sitting directly in the top folder itself (not inside a subfolder) are never shown.
So to add a new album, create a subfolder inside whichever folder your gallery section points at, and upload that album's photos into it — the section itself needs no further changes, and you can add as many subfolders (albums) as you like. See Create your own photo album for the exact steps.