The loss of the account, which market sources estimate to be worth around £800,000, is a blow to Hoffman, which has worked for PS for four years.
PS Americas brand comms director Paul Morrison said Hoffman was invited to repitch for the business but declined.
Morrison said Text would take over the account at the end of September and would focus on semiconductors and adjunct businesses. The appointment does not affect Manning Selvage & Lee, which continues to work for Philips at a corporate group level and across its medical systems, lighting, domestic appliances and consumer electronics divisions.
PS had sales of £3bn last year but is losing ground in a market dominated by Intel and Samsung Electronics.
According to figures published earlier this month by market research company iSuppli Corp, PS fell from ninth position in the third quarter of 2004 to tenth in the first quarter of this year.
PS reported a nine per cent fall in chip sales while rivals such as Renesas Technology and Toshiba recorded respective increases of ten and 8.6 per cent.
Morrison said perceived pressure on PS's market position was deceptive because the company focused more on supplying semiconductors to the consumer electronics industry, such as for TV on mobile phones.