Hi Customer,
I did a test base with several phones (Windows Phone & IPhone) base on your description. After changing the password, the phone is not able to sync anything with the Office 365 account.
For the question: Will the process still work if the phone's SIM card is changed the person who stole it?
The answer is yes. When the phone trying to sync with the Office 365 account using internet, the server will realize that the password is wrong and stop the process.
Thanks,
Yang Yu