What is this from ?
SNK Vs. Capcom: SVC Chaos. If Red Arremer/Firebrand beat you as a midboss, the character you were playing as would turn into a demon as part of his win animation. This one is M. Bison(Dictator)’s.
Click for a larger version of Bison’s transformation sprite. You can make out his trademark cap and, ahem, other key details.