When first installed, Office 365 will need a connection to the internet so it can be downloaded correctly. An internet connection will also be required for when updates are needed for Office 365 so the latest releases can be downloaded.
To manage accounts e.g. change billing options or install Office 365 on other PC’s you will need to be connected to the internet. Also, if you do not connect to the internet for a minimum of 39 days, the applications will go into reduced functionality mode meaning you can view your documents but won’t be able to make any changes to them.
However, if you have Business Premium or any other plan that includes the Office applications you can work offline to use Office applications such as Word, Excel and PowerPoint as these applications are fully installed on your computer.