There was an issue related to Primary SMTP address updated in AAD and Exchange On-Prem don't reflect in Exchange Online
We saw the SMTP address in AAD was not updated in Exchange Online and it shows the old SMTP address, and this new SMTP address didn't have activated any email address policy. Then, we did a force sync, but the old SMTP address still reflects in Exchange Online
How to use SMTP matching to match on-premises user accounts to Office 365 user accounts for director...
Some diagnostics in the backend for the affected SMTP address were run and it found when there were EXO Validation Errors, users don't sync to EXO until the Validation error is fixed. In this case the EXO validation error was about User removed the EXO License on user
If a user removed the EXO Licenses on the users which are not being synced that have EXO Litigation Hold, we need to assign EXO Licenses
Assign licenses to users in the Microsoft 365 admin center - Microsoft 365 admin | Microsoft Learn
That is why we may experience the changes are not syncing for no license assigned due to as the mailbox that has Litigation Hold, License cannot be removed and the only way to regain the License is to Delete the User. If not we need to set EXO License. Once the licenses were assigned, the sync with EXO was done