Even the biggest CD distributor is betting more on vinyl.
For a while, CDs looked like they might be making a comeback. Online chatter picked up, search interest rose, and some coverage treated a slowdown in the decline as a real turnaround.
But the latest reports point the other way.
U.S. CD revenue fell 7.8% to $312.4 million in 2025, while vinyl rose 9.3% to $1.04 billion and moved 46.8 million units against 29.5 million CDs. That gap says more about where physical media is going than the hype ever could.
$312 Million and Falling
The RIAA’s 2025 year-end report fills in what Walker left out (all figures U.S. market). CD revenue fell 7.8% to $312.4 million. Units dropped even faster, sliding 11.6% to 29.5 million.
At its commercial peak, the compact disc generated roughly $27 billion in inflation-adjusted annual sales, accounting for nearly all music industry revenue.
Today, the format represents 2.7% of an $11.535 billion market where streaming commands $9.474 billion (82%).
Physical media is a sideshow. CDs are a sideshow within the sideshow.
Vinyl tells the opposite story. Revenue grew 9.3% to $1.04 billion, surpassing that threshold for the first time in decades. This format now claims over 75% of all physical media revenue and has outsold CDs for five consecutive years. And the gap keeps widening.
The Comeback That Wasn’t
Major news and audiophile outlets have written about the CD revival for the past few years.
Around 2022, CD sales stopped their rapid decline, and some journalists treated that plateau as the start of a comeback.
There were a few data points that made the narrative tempting. First, Google searches for “CD Player” ticked up after two decades of falling.
Then, a YouGov poll suggested Americans were at least open to paying for CDs. But even that same analysis found that real consumers were still more willing to pay for streaming and vinyl.
The market itself never really supported the comeback story.
On the demand side, Luminate reported a 19.1% decline in CD unit sales in 2024.
On the supply side, labels were not behaving as if the format were returning either. For instance, Discogs data showed vinyl releases vastly outnumbering CD offerings, with “no demonstrable reemergence for the compact disc (yet!!).”
All those signals suggested that the CD “revival” was less a genuine market shift than a hopeful interpretation of a temporary plateau.
The Platform CDs Never Got
Alliance launched Alliance Authentic in January 2026 and framed it not simply as another limited-edition release program, but as infrastructure for turning vinyl into a higher-end collectible market.
From this, each record is serialized during encapsulation, linked to an embedded NFC chip, and tied to a marketplace where buyers can verify provenance, track ownership history, and resell authenticated copies.
In other words, Alliance is not just selling records. It is building a system that treats vinyl as a scarce, traceable asset.
That strategic choice matters more than the product features themselves. He built an authentication platform around vinyl because vinyl fits the logic of modern fandom and resale culture. But he did not build one for CDs.
Walker previously shared that Alliance still sold 13 million CDs last year and described the business as “extremely strong right now.” But those sales generated $124 million in CD revenue, down 6% from the year before, while Alliance’s vinyl revenue held at $344 million, nearly three times as high.
The contrast becomes even sharper in the company’s margins. Gross margin improved to 12.8% from 10.7%, which Walker attributed to “structural improvements in product mix,” while collectibles revenue jumped 31% year over year.
He also said the company planned to scale the platform in a “thoughtful and controlled way,” suggesting that Alliance sees long-term strategic value in authenticated vinyl collectibles, not in expanding the CD business.
Walker was not pretending CDs had disappeared. Thirteen million units still move through Alliance’s distribution network every year. But the company’s investment priorities point in one direction, and it is not toward jewel cases.
Why CD Keeps Failing
By any technical measure, CDs should have the advantage. They deliver cleaner playback, wider dynamic range, and stronger channel separation than vinyl, while also costing far less to buy and maintain.
For example, Vinyl’s total harmonic distortion runs 400 to 3,000 times higher than digital. Meanwhile, CDs offer 96 dB of dynamic range to vinyl’s roughly 70, and channel separation above 90 dB compared with vinyl’s roughly 30.
They are also the cheaper format by a wide margin, typically selling for $10 to $15 new versus $25 to $40 or more for vinyl, without the added costs of cleaning supplies or stylus replacement.
Yet those advantages no longer matter as much as they should, because this is no longer primarily an audio market.
CDs lose not on sound, but on presentation. A compact disc is a small, visually plain object in a plastic case. It does not create the same kind of shelf appeal, unboxing ritual, or social-media display value as a large vinyl package with oversized artwork, colored pressings, or numbered editions.
Vinyl, by contrast, turns music ownership into a visible form of participation. Every limited pressing, variant colorway, and serialized release adds a sense of scarcity that collectible markets know how to monetize.
That’s why physical media now behaves less like a listening format category and more like a fandom merchandise category, where aesthetics and exclusivity often matter more than measurable fidelity.
The irony is that much of this vinyl is still pressed from digital masters, often from the same files used for CDs and streaming. So buyers are basically paying more for a format that usually reproduces those recordings less accurately.
The best-sounding physical format did not lose because it failed as audio technology. It lost because it could not compete as an object.
What about the 2nd hand market? Last year I bought about 50 CDs, but over 40 of them were used. Like so many people in my city, I buy from the burgeoning number of used cd stores that have opened their doors. On the other hand, the one new music store in town sell mostly vinyl at $40 to $50 Cdn per record.
No thanks. CDs are the new (?) kid in town for me.
To me, its just ONE reason I do buy vinyl, instead of CD’s: I don’trust the mastrings that is used on CD, today.
– Even if the format for CD’s is MUCH better than the vinyl format, that son’t help me anything . If what is put ON the CD’s are comressed files, with MP3 qualiy and extremely comressed!
– Vinyl is simply a more honest format today, even if the CD-format, technicaly have much better spesifications! But when the record companys don’t use those oportunities, I can’t trust them. But I do trust that whats on the vinyl, is still decent mixings and masterigs.
On my high end audio system both CDs and LPs sound the same!!!!!! I still buy CDs but no more LPs as I can burn CDs to my 4TB SS hard drives and be able to listen to all my CDs that are in a small package. I’m 74 and I have about 3K LPs but when the prices of new LPs went higher and higher I just bought CDs at far more affordable prices. PLUS many new LPs had pressing defects and were noisy with clicks and pops – a feature that Millennials seem to love as it sounds more real. Shockingly almost 30% of LPs bought are never played – it’s a status thing NOT a sound thing. My MC carts cost from $1.5K – over $5K and I know how to setup a TT which most punters are unaware of.
Me too, I have ca 2K LPs in my collection and about the same amount of CDs. I stopped buying LPs five years ago, and now, I prefer to dig for used CDs. I love how jazz sounds on AAD and 24/96 CD issues. Also, I play more CDs than LPs at home. Yes, LPs are pleasant to listen to but their playback routine demands more motions and time.
I disagree. LPs and SACDs and Hi-Res streaming sound good, but plain CDs sound terrible. That is why no one is buying them.
I began buying new vinyl (again) about three years ago. I have been disappointed by many, due to sound quality. On some records, it’s as if the music is struggling to escape from my speakers. Fifty and sixty year old records from my youth blow many new vinyls away. I don’t have that problem with CDs, and IMO, CDs still sound better than lossless streaming. Still, my grand-kids love foraging through my records, and have never asked to see my streaming collection.
That’s because you need poweree studio monitors like Klipsch or JBL. My dad’s magneplanar sound horrible for modern vinyi
Having serialized NFC authenticated vinyl is silly- the probability that someone can duplicate vinyl to vinyl is almost zero. Who has vinyl producing machinery ?
A lot of people buy used copies which add nothing to sales figures. CD and LP will always be a niche because you simply don’t have to buy a physical copy to hear the music.