^^ You seem to be confusing two different processes. PCM (Pulse Code Modulation) is a method of digitally representing an analog signal. Codec (COmpression DECompression) is a method of reducing the size of a digital data file for storage and transmission.
PCM is the fundamental type of digital audio used in entertainment. It's used on CDs. It's how movies are mastered. And it's the digital format that players and receivers process to produce sound. But, multichannel PCM soundtracks are quite large. So, studios use codecs such as DD 5.1, DTS, and their lossless cousins to save space on discs. PCM is fed into an encoder to reduce the size and then is decoded to expand it back into PCM.