Create round images in Sitecore

config.xml

<getMediaStream>
    <processor type="Sitecore.Resources.Media.ThumbnailProcessor, Sitecore.Kernel" />
    <!-- Processor for rounded images should be installed before resize processor in order to get right propostions of image -->
    <processor type="Example.ImageProcessor, Example" />
    <processor type="Sitecore.Resources.Media.ResizeProcessor, Sitecore.Kernel" />
    <processor type="Sitecore.Resources.Media.GrayscaleProcessor, Sitecore.Kernel" />
</getMediaStream>

ImageProcessor.cs

namespace Examples
{
    using System;
    using System.Drawing;
    using System.Drawing.Imaging;
    using System.IO;
    using System.Linq;

    using Sitecore.Data.Items;
    using Sitecore.Diagnostics;
    using Sitecore.Resources.Media;

    public class ImageProcessor
    {
        private static readonly string[] ImageExtentions = { "bmp", "jpeg", "jpg", "png", "gif" };

        public void Process(GetMediaStreamPipelineArgs args)
        {
            Assert.ArgumentNotNull(args, "args");
            if (args.Options.Thumbnail) // should not apply for thumbnails
            {
                return;
            }

            var outputStream = args.OutputStream;
            if (outputStream == null)
            {
                return;
            }

            var functionsArg = args.Options.CustomOptions["rnd"]; // searching for parameter in options
            if (string.IsNullOrEmpty(functionsArg) || !functionsArg.Equals("1"))
            {
                return;
            }

            var extension = args.MediaData.Extension;
            // need to check extension, in order not to apply handler on PDF
            if (!ImageExtentions.Any(x => x.Equals(args.MediaData.Extension, StringComparison.InvariantCultureIgnoreCase)))
            {
                return;
            }

            args.OutputStream = this.GetRoundedImage(outputStream, extension, outputStream.MediaItem, args.Options.BackgroundColor);
        }

        private MediaStream GetRoundedImage(MediaStream outputStream, string extension, MediaItem mediaItem, Color backgroundColor)
        {
            var sourceImage = (Bitmap)Image.FromStream(outputStream.Stream);

            // image processing
            var diameter = sourceImage.Width > sourceImage.Height ? sourceImage.Height : sourceImage.Width;
            var cropRectangle = new Rectangle((sourceImage.Width - diameter) / 2, (sourceImage.Height - diameter) / 2, diameter, diameter);

            var croppedImage = sourceImage.Clone(cropRectangle, sourceImage.PixelFormat);
            var textureBrush = new TextureBrush(croppedImage);
            var finalImage = new Bitmap(diameter, diameter);
            var graphics = Graphics.FromImage(finalImage);

            var solidBrush = new SolidBrush(extension == "png" ? Color.Transparent : backgroundColor);
            graphics.FillRectangle(solidBrush, 0, 0, finalImage.Width, finalImage.Height);
            graphics.FillEllipse(textureBrush, 0, 0, finalImage.Width, finalImage.Height);
            graphics.Flush();

            var memoryStream = new MemoryStream();
            finalImage.Save(memoryStream, ImageFormat.Png);
            memoryStream.Flush();
            memoryStream.Seek(0, SeekOrigin.Begin);
            // image processing end

            return new MediaStream(memoryStream, extension, mediaItem);
        }
    }
}