I believe it is bitwise xor. This means that when you have the notation: x^y, x and y get translated to the binary system and the get xored per bit. An example:
Say we have 5^8:
6 ^ 10
110 ^ 1010
0110
1010
____ ^
1100
1100 translates to 12. So, 6^10 = 12.
(Xor: When only ONE bit is set, the output is true, else the output is false)
What is its use? Its often used for simple cryptography.