1. "They" usually refers to two or more people. In this case: "They lost their phones" means that there were several people and several phones. We'd understand that everybody had phones, and that all the phones were lost. "They lost their phone" means that there was only ONE phone. A pair or group of people only had one phone between them, and they lost it. 2. Sometimes we use 'they' to refer to one person when we can't or don't want to specify whether that person is male or female: For example, "Someone came here and said that they lost their phone" refers to one person and one phone.

Their phone = 1 phone belongs to all of them. Their phones = each of them has his/her own phone.

Answers below explain about "they" being an either singular or plural subject. The singular or plural object "phones" is simple whether you are refering to one or more object, little to do with the subject. . The person was distracted. They had lost all their phones as well as one charger and all their money.

They can be used a singular or plural noun, and I think that can influence the verb choice. We sometimes use "they" as a singular noun when we don't know or don't to include the gender. They lost their phones. - Plural subject noun is being used, so Multiple people each lost multiple phones. They lost their phone. - Singular subject noun is being used, so one person (could be male or female) lost his or her phone. Also, They lost their phone - could imply a plural subject (maybe a married couple who share a phone) lost one phone.