"Content of your files and communications you input, upload, receive, create, and control. For example, if you transmit a file using Teams to another Teams user, we need to collect the content of that file to display it to you and the other user. If you receive an email using Outlook.com, we need to collect the content of that email to deliver it to your inbox, display it to you, enable you to reply to it, and store it for you."
Microsoft collects and processes all user content including files, emails, communications, photos, videos, and documents stored in their cloud services, retaining broad processing rights over this content.