Microsoft 365 SMTP authentication failure [SMTP: Invalid response code received from server

i am getting following error but all settings are correct no issue but advice if someone has done smtp setting of 365 office

connectors are added in admin center and changed the max sp as advised

authentication failure [
    SMTP: Invalid response code received from server 
    (code: 535, response: 5.7.3 Authentication unsuccessful 
        [LO2P265CA0220.GBRP265.PROD.OUTLOOK.COM]
    )
]

here is code:

<?php
    require_once "Mail.php";

    $from = '<[email protected]>'; 
    $to = '<[email protected]>'; 
    $subject = 'Insert subject here'; 
    $body = "Hello world! this is the content of the email"; 

    $headers = array(
        'From' => $from,
        'To' => $to,
        'Subject' => $subject
    );

    $smtp = Mail::factory('smtp', array(
        'host' => 'smtp.office365.com', 
        'SMTPSecure' => 'tls',
        'port' => '587',
        'StartTLS' => true,
        'auth' => true,
        'username' => '[email protected]',
        'password' => '321password' 
    ));


    $mail = $smtp->send($to, $headers, $body);

    if (PEAR::isError($mail)) {
        echo '<p>'.$mail->getMessage().'</p>';
    } else {
        echo '<p>Message successfully sent!</p>';
    }
?>