Well, my two younger brothers have three names, even though they just use the first. I think it is just a way to honor family members, or maybe because the parents went with the favored name, but also loved a particular name and wanted to use it as a part of the name too.
Take Felipe for example. Felipe Juan Pablo Alfonso. Felipe is supposed to be after one of the first Borbon kings, Juan after his paternal grandfather, Infante Juan, Count of Barcelona; Pablo after his maternal grandfather, King Paul of Greece, and Alfonso for his great-grandfather, Alfonso XIII. His sisters have the same thing as well, as with their children. Froilan's first names, Felipe Juan, are for his uncle and grandfather; Victoria's names are for Queen Victoria Eugenia and Queen Sofia's mother, Queen Frederica. Cristina's children, Juan for his grandfather, for Pablo, King Paul of Greece. Miguel, that's after Inaki's brother, I think; and Irene, for Queen Sofia's sister, Princess Irene of Greece.