My own experience is that I don't really understand conversations simultaneously, but I have a very large auditory buffer (auditory working memory, I guess). So I can keep talking while listening to someone else, but what I'm really doing is spooling what they said into my buffer, that I then "play back" when I'm not talking or concentrating on something else. This is also the skill that allowed me to be a highly skilled
scrutineer for ballroom competition, back before everything was done by computer, because I could listen to someone reading a list of numbers and find them on a sheet of paper, continuously rolling my "buffer" if I got behind by 4 or 5 numbers.
