Magic Pony creates algorithms that can understand and analyse pictures. It was set up in 2014 and has 14 engineers, 11 of which have PhDs.
Last year, Twitter acquired live streaming app Periscope, which has now been integrated into the platform. Periscope competes for attention with similar tools from Facebook and Snapchat. Magic Pony’s first product can be used to increase the quality of live video by using machine learning to improve pictures affected by low light and poor cameras.
Twitter’s co-founder and chief executive Jack Dorsey tweeted: "This team helps us with our goal of making Twitter the first and best place to see what’s happening in the world, and talk about it, live!"
Magic Pony’s chief executive, Rob Bishop, will move to San Francisco as part of the deal, while the other employees will join Twitter’s London office.
Bishop said: "Joining forces with Twitter gives us the opportunity to bring the benefits of that research to hundreds of millions of people around the world."