Pulse-code modulation is a method to digitally represent sampled analog signals. It is the standard form of digital audio. The original analog music waveform is described in two parts. The first is its amplitude(size). Represented by the number of bits. Like 16-bit of the original audio. The second is intervals, for example, the interval of measurement can be done 44,100 times a second. This is the sample rate.
Read more about these two parts here:
The combination of the sample rate and the bit depth makes up the major part of PCM. The last part is encoding the audio, that part involves some complex mathematical work where the analog sound is converted to binary. It is unnecessary to fully understand from an audio perspective.
Different than the DSD format.
*Picture and info by whathifi.com