In effect, this would allow for devices like phones and laptops to be thinner than a standard headphone jack while still including one. The port would remain in a closed state when not in use, flush with the dimensions of the device itself. A 3.5mm plug could then be inserted, expanding that jack outward to accommodate it. In the filing, Microsoft demonstrates the mechanism working in three different variations, with either the front, back, or both sides of the mechanism expanding.
Apple was probably the most high-profile company to ditch the headphone jack on its iPhone 7, but Android manufacturers also have been following the trend as the industry moves to either make room for other components or simply make devices thinner.
An expandable headphone jack could at least solve the problem of keeping the 3.5mm port around on thinner devices, but it comes with the tradeoff of a more complicated design. Still, it's an interesting concept nonetheless. As for whether we'll actually see Microsoft implement this design, that's up in the air. Patents are filed all of the time for things that never see the light of day in shipping products. That said, it would make an interesting addition to a foldable device.