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Delphi allows to load a jpeg file into a TImage, however will not "populate" the TBitmap of that TImage, yet show the image.
To get a jpeg loaded correctly (if you want to manipulate the TBitmap), then the following procedure works much cleaner (unit jpeg is needed for that, which comes with Delphi):
var
JPEG1 : TJepegImage;
...
JPEG1:=TJpegImage.Create;
JPEG1.Performance:=jpBestQuality;
JPEG1.LoadFromFile(FileName);
Image1.Picture.Bitmap.Assign(JPEG1);
...
