From step 1 to step 2 they added 3 squares.
From step 2 to step 3 they added 5 squares.
Each step they add the next odd number in sequence: 3,5,7,9,etc.
So for step 4 they would add 7 more squares. Add 7 to the number of squares in step 3 for total squares:
7 + 9 = 16
step 4 will have 16 squares.