iPhone thief phished iCloud password. Can they decrypt iPhone contents? Long story short, a close friend had their iPhone stolen a few months ago. Just yesterday they got a text saying their phone was found with a link claiming to show the phone's location. Unfortunately, this person fell for the phish and ended up submitting their iCloud credentials. I assume that the thieves now have the ability to reset the phone.

The main worry here though, is whether the thieves are able to decrypt the contents of the phone? Is it possible for them to extract the data from the phone knowing the iCloud password?

EDIT: Also, is there any valid fear that they can extract the data directly from storage by connecting a USB cable to the phone or use any 3rd party apps to do this?
Did the user have an iCloud backup?
If yes, the data is available. 
https://support.apple.com/kb/ph12521?locale=en_US

If no, the phone is erased as part of the recovery process.  To get the data, you would need to connected to the computer the data was backed up on. 
https://everymac.com/systems/apple/iphone/iphone-troubleshooting-repair-faq/iphone-how-to-unlock-open-forgot-code-passcode-password-login.html