PHP is server side.
If you are observing the code not from local files on the server you should not see any PHP.

PHP can be inside the HTML tags, That is why when you inspect the elements you can no longer see the PHP Scripts.

PHP, ASP.NET, Ruby on Rails are Server side languages. Their scripts are run not on your computer/browser, but on the server which hosts the website and sends down the HTML code.

This is the reason you will see HTML in the source code. You can find the difference b/w client side and server side code here.