When the JumpCloud is configured as the password authority for Office 365 accounts via the JumpCloud Office 365 Directory Integration, and when multi-factor authentication is enabled for the Office 365 accounts on the Microsoft side of the trust, authentication conflicts may arise where legacy endpoints are unable to authenticate via two factors.
This conflict has nothing to do with JumpCloud and is a limitation of the endpoint to authenticate with two factors.
Microsofts documented solution to this problem is "App passwords".
Legacy endpoints that do not support two-step verification for authentication can be configured to authenticate using "App passwords" which are configured within users Microsoft account settings page.
Find more information, including a how-to guide for configuring "App passwords" in this Microsoft KB article: App passwords and two-step verification
"App passwords" are only required for legacy endpoints that cannot authenticate via two-step verification and do not work on modern endpoints that do support the two-step login workflow.