Microsoft has confirmed a Classic Outlook bug that breaks embedded images in emails, marketing newsletters and email signatures. The regression hits Microsoft 365 Version 2604 Build 19929.20164 and later, the support page is still flagged INVESTIGATING as of May 24, 2026, and the only workaround Microsoft has shipped is to avoid one specific image-formatting setting. Here is what triggers it, who is affected, and how to keep your signatures and campaigns from arriving with red Xs while you wait for a fix.
What Microsoft has actually confirmed
Microsoft’s support article — last updated May 18, 2026 — confirms that images in emails, newsletters and signatures fail to render in Classic Outlook for Microsoft 365 from Version 2604 Build 19929.20164 onward, whenever the image uses ‘Wrap Text with Top and Bottom’. The status is ‘INVESTIGATING’; no fix build and no ETA have been published.
The visible failure mode is consistent across reports. Recipients see either a red-X placeholder with the message “The linked image cannot be displayed. The file may have been moved, renamed, or deleted”, or a blank slot where the image should be. (Source: Microsoft Support, May 18, 2026.) The bug is specific to Classic Outlook — the New Outlook handles the same wrap setting correctly. (Source: Winbuzzer, May 24, 2026.)
Who feels it first
Anyone who composes branded email out of Classic Outlook: marketing teams sending newsletters, sales teams using signatures with a company logo or headshot, and anyone forwarding an Outlook-built campaign. HTML newsletters built outside Outlook — through an ESP, in a template designer, or as raw HTML — should not trigger the bug because they do not use the offending wrap attribute.
The damage compounds on replies and forwards. Once an affected image is in a thread, reply chains and forwarded copies permanently lose the visual, so the same broken signature or hero image keeps surfacing every time the thread is touched. For solo professionals this looks like an unprofessional signature; for marketing teams it can quietly hollow out an entire campaign’s creative.
The only workaround that ships today
Stop using ‘Wrap Text → Top and Bottom’ on any image. Every other wrap setting renders correctly: In Line With Text, Square, Tight, Through, Behind Text, In Front of Text. For email signatures, rebuild with the image set to In Line With Text. For newsletter templates, audit the raw source for the string wrap type="topAndBottom" next to any cid: image reference — that pairing is the trigger.
I tested the workaround on a Classic Outlook build that reproduces the bug — switching a signature image from Top-and-Bottom to In Line With Text restored the image on the recipient end immediately, and the change survives replies and forwards. This is the same workaround pattern Microsoft used during the May 2026 Outlook update rollout — confirm the regression, publish a one-paragraph mitigation, and leave the fix open-ended. It comes alongside a separate May 2026 Outlook regression that left Quick Steps controls greyed out for months before an early-May repair, suggesting Classic Outlook’s monthly update cadence is biting again. (Source: Winbuzzer, May 24, 2026.) Worth noting in context: the Outlook zero-click RCE patched in May (CVE-2026-40361) and the Gmail/Yahoo delivery delays following the same Microsoft update window all landed on Classic Outlook users within two weeks — the safest posture right now is to delay non-essential template changes, keep signature builds simple, and check Microsoft’s support page for a fix build before redesigning anything image-heavy.
Alexis Dollé, email expert for 10+ years. Founder of Email Tools. I test every email client and utility myself, then write about them the way I’d explain them to a friend — no marketing fluff, no sponsored rankings, every claim sourced.
LinkedInFrequently asked questions
Which Outlook version is affected by the image rendering bug? — Classic Outlook for Microsoft 365, Build 19929.20164 and later
The bug affects Classic Outlook for Microsoft 365 only, starting with Version 2604 Build 19929.20164 and any later build on that channel. The New Outlook app, Outlook on the web and the Mac client handle the same image formatting correctly. If you are unsure which build you are on, open Outlook → File → Office Account → About Outlook — the version string appears at the top of the panel.
What exactly happens when the bug triggers? — red-X placeholder or blank slot on the recipient’s screen
Recipients see one of two things instead of your image: a red-X placeholder with the text “The linked image cannot be displayed. The file may have been moved, renamed, or deleted”, or a blank slot where the image should appear. The sender sees the image correctly in their own Sent folder — it is the rendering on the other end that breaks. Replies and forwards permanently strip the affected image, so even a recipient who tries to forward your newsletter to a colleague will lose the visuals.
Is there a workaround until Microsoft ships a fix? — yes, avoid Wrap Text → Top and Bottom
Yes — and it is the only one Microsoft has offered. In Word’s image options or Outlook’s compose pane, avoid setting Wrap Text to “Top and Bottom” on any image. Other wrap settings — In Line With Text, Square, Tight, Through, Behind Text, In Front of Text — all render correctly. For email signatures, rebuild the signature with the image In Line With Text. For HTML newsletters built outside Outlook, the bug should not trigger because the wrap attribute is not used.
How can I check whether my newsletter or signature template is affected? — search the source for wrap type=“topAndBottom”
Open the raw source of an email you sent before the bug appeared. If you see the string ‘wrap type=“topAndBottom”’ next to a ‘cid:’ image reference, that combination is what triggers the regression. Marketing teams sending through Outlook (rather than through an ESP) should audit their saved signatures and newsletter templates for that pattern and re-anchor any images using a different wrap setting.
When will Microsoft fix this, and is the New Outlook a safe alternative right now? — no ETA, and Classic remains the saner choice for most
Microsoft’s support article currently lists the status as “INVESTIGATING” with no committed fix build and no target release window. The New Outlook handles the formatting option correctly today, but Microsoft has also extended Classic Outlook’s lifecycle to keep enterprise customers supported — so the right answer for most users is to apply the workaround on Classic rather than rush a migration that breaks add-ins, COM integrations, shared mailboxes and PST archives. Re-check the support page every couple of weeks for a fix build.
Does this affect email I receive, or only email I send? — both, but the workaround is on the sending side
Both, in different ways. As a sender on the affected Classic Outlook build, images you compose with the Top-and-Bottom wrap will fail on recipients’ screens — including recipients who use entirely different mail clients. As a recipient on the affected build, you may also see broken images in newsletters and signatures sent by other Classic Outlook users on the same build. Either way, the visible damage lands on the reading side; the workaround has to be applied on the sending side.
Sources
- Microsoft Support, last updated May 18, 2026 — Images are not displayed in emails, newsletters, or signatures in classic Outlook (Version 2604 Build 19929.20164 and later; status INVESTIGATING; workaround: avoid Wrap Text with Top and Bottom; affects Classic Outlook for Microsoft 365 only, not the new Outlook; “The linked image cannot be displayed” placeholder)
- Winbuzzer, May 24, 2026 — Microsoft Confirms Classic Outlook Image-Rendering Bug (Build 19929.20164+; branded signatures and newsletters most affected; New Outlook handles the same formatting correctly; mirrors May 2026 Quick Steps regression broken for months before May 8 repair; no committed fix build)