Yes it can.

When you send a newsletter you can choose whether or not to embed images. You do this by selecting the 'embed images' option when you are sending your emails or setting up your autoresponders.

Embedded images are a great way to allow people to read your HTML emails when they aren't connected to the Internet, and that's the main reason a lot of people choose to embed images.

Embedding images can greatly slow the speed that your emails are sent out.