>>14383197A flashlight does not produce a parallel beam; it produces a cone of light, that gets wider and less bright the further it travels. This is true even for lasers, which will produce a cone whose angle is very narrow indeed but still greater than zero. This means that the amount of light per unit surface area (i.e. the effective brightness when looking at it) will indeed get fainter with distance traveled.
If you were to produce a beam of light that is actual parallel, then yes, it will keep going until it hits something, without losing any brightness, and then get absorbed or reflected or something. I *think* this is not actually possible because [mumble mumble quantum mechanics] but I'm not positive here.