Qwiki is a mobile app for creating videos in Apple's iPhone.
In May, Yahoo bought blogging service Tumblr for $1.1 billion in cash. Earlier this week, the company reportedly acquired Bignoggins Productions, another mobile app developer.
Qwiki's app would continue to be supported by Yahoo and its employees would move to Yahoo's New York offices.
"The Qwiki app will live on as a standalone entity inside Yahoo, where we will grow our thriving community and where our team will continue to work to help you share life's best experiences," the team said.