Increasing the license quantity is always possible at any point.
Decreasing the license quantity is only possible at the end of the term. Monthly commitments have a monthly term, so you can decrease at the end of the month. Yearly commitments have a 1-year term, so you can decrease at the end of the year term. Multiple year commitments have multiple 1-year term, so you can decrease at the end of each 1-year term. Reviewing upcoming renewals in advance helps avoid unnecessary costs or licensing shortages.