OP @moose89
The DAC takes the digital data encoded on the CD and converts it to the analog audio signal to your system using a DAC (Digital-to-Analog Converter). The digital data on the CD is just a digital representation of the music signal. It's not like a computer that records bitt that can be directly converted to alpha and special characters. The ONLY way a CD player does NOT use a DAC is when the digital signal is fed into an external DAC.