The Text Editor module uses an instance of the classic WordPress editor, with some differences in the toolbar.
You can add headings images, and make simple changes to text formatting directly in this editor.
You can style your text using either the toolbar on this text editor or the Style tab. If you want to style specific parts of the text, use the toolbar above the editor. You can expose the second row of the toolbar by clicking the rightmost icon in the first row:
The Style tab has a variety of settings that apply to all of the text in the module, such as text color and a Typography section, which gives you many choices not available in the text editor, starting with font family.
There are all the usual Advanced tab settings for margins, visibility, animations, and advanced HTML settings.