A .NET Core application is built to receive an image from WhatsApp, process the image using the Pho.to API, and return the processed image. The application uses Twilio's WhatsApp API and the Pho.to API to achieve this functionality. It also includes a webhook endpoint that responds to incoming messages with the URL of the processed image. The application handles errors and exceptions by implementing a do-while loop to check the status of the image processing task. Additionally, it provides a basic example of how to use the Pho.to API to process images and return the results in XML format.