Hi QS-IT,
This issue will occur if the picture added into AD is more than maximum size of a picture in Lync Online.
By default, the maximum size of a picture in Lync Online is 30 KB. Depending on the size of your picture, do one of the following:
If the picture is more than 30 KB, you have to resize and snip it down to size before proceeding.
If the picture less than 30 KB, you can upload it.
Moreover, there is no requirement for pixel density of the photo.
Regards,
Jerry