PMU (performance monitoring unit) is a piece of hardware on most modern cpus. There is one that sits next to each physical core on the CPU. It usually contains a set of fixed registers which can only collect one event, and general purpose registers which can be programmed to increment on any hardware event.
Here you can see how perf stat -e {cycles,cycles,cycles,cycles,cycles,cycles} sleep 3 would get scheduled on the PMU. When there are more events than registers available it automatically starts multiplexing between the groups and scheduling them. If a group of events cannot be scheduled together it will give <not counted> errors.