Microsoft (#GuyInAcube) suggest to think of it as follows:

1. An apartment complex representing either AAD / Office 365
2. An apartment representing a tenant.
   • The tenant can be an individual, company or an organisation
   • The tenant will be assigned a unique domain of the form <account>.onmicrosoft.com (This can be updated to the company domain if required)
   • The tenant represents a relationship with Microsoft
   • An Azure AD tenant is a specific instance of Azure AD. Each instance is completely isolated from each other and has a default environment named “{Azure AD tenant name} (default)”
3. Each apartment contains environments, users, groups & billing (subscriptions)
   • An example environment URL being contosodev.crm6.dynamics.com
   • An example user being user@contoso.onmicrosoft.com