Same issue with SMTP here while trying to get GMail sending mails using my O365 address. Tried to set it up today for the first time. Error message is:
334 VXNlcm5hbWU6 334 UGFzc3dvcmQ6 535 5.7.3 Authentication unsuccessful [AM0PR04CA0033.eurprd04.prod.outlook.com] , code: 535