A header element is not working because it converts <?php to <--?php

I have a header element called "Single Post Entry Header" that was created when installing a template from the Site Library. A few days ago it started to get broken, showing code on the frontend:

This is the code:

<div id="custom-post-entry-header" class="custom-post-header grid-container">
	<?php
	$categories = get_the_category();
	$separator = ' | ';
	$output = '';
	var_dump($categories);
	
	if ( ! empty( $categories ) ) {
		foreach( $categories as $cat ) {
			$name = $cat->name;
			$output .= '<a href="' . esc_url( get_category_link( $cat ) ) . '" alt="' . esc_attr( sprintf( __( 'View all posts in %s', 'textdomain' ), $name ) ) . '">' . esc_html( $name ) . '</a>' . $separator;
		}
		
		echo trim( $output, $separator );
	}
	
	the_title( '<h1 class="entry-title" itemprop="headline">', '</h1>' );

	if ( has_excerpt() ) : // Only show custom excerpts not autoexcerpts ?>
		<p class="entry-subtitle"><?php echo get_the_excerpt(); ?></p>
	<?php endif; ?>
</div>

The problem is that the first PHP opening tag is changed to <-- so it becomes a comment, and then where $category->name the -> becomes to --> so it closes the comment.

If I disable the Element and create it in Code Snippets it works great.

Why is this happening? Can you fix it?

Thanks