CORRECTED - UPDATE 2-DreamWorks 3rd-qtr profit beats Street, shares up

(Corrects closing share price in paragraph four to $31.98 instead of $31.95)

* Q3 EPS 23 cents vs analysts' consensus of 16 cents

* "Monsters vs. Aliens" DVD boosted sales

* Shares up in after-hours trade (Adds details from results, background)

LOS ANGELES, Oct 27 (Reuters) - DreamWorks Animation SKG Inc (DWA.O) posted better-than-expected profit on Tuesday, helped by the release of the "Monsters vs. Aliens" DVD, sending its shares higher after hours.

DreamWorks posted net income of $19.6 million, or 23 cents per share, and revenue of $135.4 million, compared with net income of $37.4 million, or 41 cents a share, and revenue of $151.5 million a year ago, when results were boosted by the hit "Kung Fu Panda."

DreamWorks results topped analysts' consensus estimates for earnings of 16 cents a share, according to Thomson Reuters I/B/E/S.

Shares of DreamWorks rose 1.6 percent to $32.50 in after-hours trade, after closing at $31.98.

"Monsters vs. Aliens," contributed $33.4 million of revenue to the quarter, driven by its continued performance at the worldwide box office and the initial release into the domestic home entertainment market on Sept. 29, 2009.

DreamWorks said its expects its fourth-quarter to be driven primarily by two TV specials: "Monsters vs. Aliens: Mutant Pumpkins from Outer Space" and "Merry Madagascar", both of which are scheduled to air in prime-time on NBC. "Merry Madagascar" is also scheduled to be released into the home entertainment market in the fourth quarter.

The latest quarterly results included a tax benefit of $2.5 million related to a tax sharing agreement with a former stockholder. The benefit was partially offset by a $2.1 million increase in costs.

The net benefit of $0.4 million, when combined with the company's research and development tax credit related to the prior year of about $1.8 million, resulted in an overall net increase to net income of $2.2 million, or an estimated three cents per share on a fully diluted basis. (Reporting by Susan Zeidler)