By default, Apple Music streams audio in the AAC format. However, in the Apple Music app, there is a sound enhancer to improve the audio quality. There is also an option to switch to high-resolution lossless audio, which uses a lot more bandwidth.
Apple Music has lossless audio tracks, but it’s not available to everyone. If you have a voice-only subscription, you can listen to music in the standard streaming format. The full catalog of lossless audio is available for Student, Individual and Family subscriptions.