Answer
This is typically caused by the O365 mailbox account having Multi-Factor Authentication (2FA/MFA) enabled, which is incompatible with the basic SMTP authentication IFS's mail sender uses — disabling 2FA on that specific mailbox has resolved this exact 535 5.7.139 error. Rather than disabling 2FA account-wide as a security tradeoff, check whether Microsoft 365 offers an app-specific password or a dedicated service-account exemption for this mailbox instead, which achieves the same SMTP-compatible authentication without weakening the account's overall MFA protection.