Learn Icelandic: Svona áskorun er alltof útbreidd. - Such a challenge is way too widespread.

Because svona (meaning "such" or "like this") is an invariable determiner. Unlike most adjectives and pronouns in Icelandic, words like svona and þannig never change their form, regardless of the gender, number, or case of the noun they describe.

In English we say "such a challenge". Why isn't there an article in the Icelandic sentence?

In Icelandic, words like svona and þannig don't take an indefinite article ("a" or "an") after them like English does. You just put svona directly in front of the bare noun: svona áskorun (such a challenge / a challenge like this).

Why does the adjective útbreidd end in -dd here instead of the dictionary form -ddur?

The adjective útbreiddur (widespread) must agree with the noun it describes. Because áskorun (challenge) is a feminine noun in the nominative case, the adjective drops the masculine -ur ending to take the feminine nominative form útbreidd.

How can I remember that áskorun is a feminine noun?

A very reliable rule of thumb is that Icelandic nouns ending in the suffix -un (like áskorun "challenge", hugsun "thought", or verslun "shop") are almost always feminine.