macOS Apple Mail will not send email with Office 365 using Exchange connection

I have been successfully using the macOS Apple Mail app to send and receive email through a hotmail.com email address for several years. Recently, summer 2025 the sending option has broken. Receiving email works good. I have attempted to remove and reconnect using different methods recommended from Apple and Microsoft and for the past couple weeks sending mail is not working. I have enabled 2FA and disabled it, also created app password to attempt to use in the Apple Mail client. The server settings verify and my account connects ok, but will not send emails. The Mail client will just hang and eventually time out. It also seems that despite POP and IMAP features being enabled in Office 365 settings, these options are not working with Apple Mail anymore either.

The iOS devices work good and send / receive ok as expected.

The main difference between Mail on the desktop operating system is the option to select Outlook.com as the email provider is no longer available, but is still an option on iOS which is working as intended.

Anyone with a workaround or solution to fix this issue? I would rather not cease use of Apple Mail on desktop and be forced to use Outlook as my main email client.

Articles with instructions referenced:

Add email accounts in Mail on Mac - Apple Support

Choose the correct email provider when adding an account to Mail - Apple Support

https://support.microsoft.com/en-us/office/set-up-email-in-mac-os-x-mail-de372dc4-9648-4044-a76c-e8a60e178d54