I ran the tool against a 2016 NAIP image service and symbolized the LiDAR points by RGB value and they're all black. Running the tool against a NAIP MrSid file on our county network produced successful results. The tool help doesn't list the types of supported rasters for the in_image parameter:
Colorize LAS—Help | ArcGIS Desktop
The tool appeared to recognize the NAIP image service bands 1-3 correctly. The LiDAR used is ASPRS 1.4, point record format 7, meaning it can't store infrared. Could it be the imagery is 4-band, though I didn't set infrared in the tool, that caused the problem?
