Intangible Asset

An intangible asset is a non-physical asset that holds significant value for a company, such as intellectual property, brand recognition, goodwill, or patents. Unlike tangible assets like machinery or buildings, intangible assets are harder to quantify but can provide substantial competitive advantages and generate future economic benefits. Intangible assets are critical for companies in industries such as technology, pharmaceuticals, and entertainment.

Example

A software company’s intellectual property, including patents for its proprietary technology, is considered an intangible asset that contributes to its market value.