mobile phone) as well as 'something that you know' (i.e. This authentication code is received via a text, phone call or an MFA application and so it relies on 'something that you have' (i.e. When MFA is enabled, you will be prompted to enter an authentication code in addition to your normal password before you are able to log on. You just need to enable it against the MFA settings for the user in Azure A.D.)
(It is worth pointing out that if you use your Office 365 account for Azure then the MFA that comes free with O365 can also be used for Azure. "Privileged accounts" include 'Global Administrator', 'SharePoint Administrator', 'Exchange Administrator', 'Conditional Access Administrator' and 'Security Administrator'.
but for now it is optional and needs enabling if you want to use it. This will be enabled by default when the service goes G.A. In June, Microsoft announced that it is previewing MFA for protecting "privileged Azure AD accounts" for free, which a lot of people don't seem to be aware of.
However, this feature typically requires Azure Active Directory Premium, which comes at a small cost per user and it isn't always within budget. Passwords are simply not secure and so having MFA enabled is an absolute no brainer to me. Whenever I speak to a new client, I always strongly advise them to enable Multi-Factor Authentication (MFA) for their Azure portal.
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