Dear Fawad,
Good day! Thank you for posting to Microsoft Community. We are happy to help you.
It is understand from your description that you want to configure HTML signature on Outlook mobile app for iOS. Unfortunately, Outlook app for iOS and Android does not support HTML signatures by default. The mobile app uses plain text and probably converts the image in your signature to a plain text format.
However, from search, I also found with third party tool we can set this, so here sharing some details, you can try and check the result:
• Design your HTML email signature with third party tool (like free email signature generator or any other HTML editor of your choice).
• Send yourself an email that includes your HTML email signature from another device or web-based email client.
• Open this email in Outlook for iOS and copy the signature by selecting it and tapping Copy.
• Go to your Settings and tap Mail.
• Tap Signature and delete your current signature if you have one.
• Paste the HTML signature that you copied earlier and save the changes.
Now, you should be able to use your HTML email signature in Outlook for iOS. You can also use this method to create rich HTML signatures on iPhone and iPad for the Mail app.
Hope this can help you, if there is any deviation in my understanding, please forgive me and provide me with more details, I am more than willing to continue to help you!
I wish you all the best!