I’ve asked our engineers about the issue. The problem is that the plugin is configured to point to the multi-tenant endpoint on Office 365. The suggested workaround is that since Office 365 is the same as Azure AD, the Discourse OpenID Connect plugin can be used to point to a single tenant endpoint. Details about configuring that plugin are here: OpenID Connect Authentication Plugin. Have a look at the Azure AD entry in that topic’s Provider Specific Notes section for details about how to set this up.
If anyone has run into issues with using the OpenID Connect plugin in place of the Office 365 plugin, please let us know.