Number one vendor Samsung gained market share while Apple lost ground, hit by a 26 percent drop in sales in China and its mature Asian markets as well as a decline in key regions North America and Western Europe.
Overall sales of mobile phones fell by 0.5 percent as feature-phone sales dropped 14 percent and only five vendors from the top 10 showed growth in the quarter.
Gartner's research showed that demand for premium smartphones slowed in the second quarter as consumers waited for new hardware launches in the second half of the year. Sales of these devices in mature markets dropped by 4.9 percent, with only Japan bucking the trend.
Smartphone sales rose in all emerging regions except Latin America and growth in this segment was 9.9 percent.
The vendors in the top ten showing growth in the overall phone market were all Asian: Huawei, Oppo, Xiaomi, BBK Communication Equipment and Samsung.
Samsung was the world's leading smartphone maker in the second quarter, when it sold 76.7 million units, giving it a 22.3 market share, up from 21.8 percent a year earlier, as its Galaxy A and Galaxy J ranges competed strongly with Chinese manufacturers and as it won back the share it recently lost in emerging markets.
Apple was at number two, with 44.4 million units and a market share of 12.9 percent, down from 14.6 percent as sales slumped 7.7 percent in the quarter of 2016, hit by declines in the key mature markets of North America (its largest) and Western Europe and by an even faster decline in Greater China and mature Asia/Pacific regions, where sales declined 26 percent.
Apple reported a 21 percent decline in unit sales of its iPhone in the three months to June and Foxconn, a key Apple supplier recently blamed slowing iPhone sales for a decline in its second-quarter net profit.
At number three, Huawei's share of the smartphone market rose to 8.9 percent from 8 percent a year earlier as it sold 30.7 million units. Fourth-placed Oppo more than doubled its market share to 5.4 percent from 2.4 a year earlier, selling 18.5 million smartphones, driven by its R9 handset.
Xiaomi was the world's fifth largest smartphone seller at 15.5 million units and its market share declined to 4.5 percent from 4.7.
The top five smartphone manufacturers together continued to gain market share in the second quarter of 2016, up from 51.5 percent to 54 percent.
By operating system, Android increased its market share to 86.2 percent from 82.2 percent, selling 292.9 million units, driven by growth in sales of low-mid range devices in emerging markets as well as a 6.5 percent increase in sales of premium smartphones.
Apple's market share in operating systems fell to 12.9 percent from 14.6 percent a year earlier as it sold 44.4 million units. Windows had just 0.6 percent of the market, down from 2.5 percent a year earlier.
