SharePoint Online is a cloud-based Microsoft service, it is part of the Office365. SharePoint provides tools to share files and information across the whole organisation. In most of the cases, SharePoint is applied to develop Intranet and internal portals, this is, project with collaboration needs.
SharePoint is available On-Premises and as a cloud-service, named as SharePoint Online. Some years ago, Microsoft launched Office365 and it includes, mostly, license to use SharePoint Online. It means that if your company already owns an Office365 license, probably, there are licenses to use SharePoint Online, and it is a waste of resources if you already have it and do not use this powerful collaboration tool.
Just to give an example, in an Intranet project, SharePoint is applied to create the main organisational site, that one with institutional information and then, normally, there are one site for each department. In this way, each department can have the own subsite with its documents, news and with confidential documents restricted for who works there.
One of the biggest advantages of using SharePoint is the fact that it empowers the users with tools for collaboration and management. The management can be spread in the organization, each department can have one person, or team, responsible for this. Therefore, the company does not depend on the IT department for most of the common requirements.
I have been working on many Intranet projects based on SharePoint, some of them for huge companies and others, to mid-size ones which want to have a space to share and to collaborate. In some cases, we have developed one site for each department with many specific demands, and, while, for other companies, we have developed Intranets with a simpler structure creating one main site for the whole organisation and specific document libraries for each department. There is not a rule for this, it depends on the organization needs.