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The Battle of Midway has received tons and tons of ink (and deservedly so) because it was considered to be the turning point in the war against Japan. But in order to turn something around, it has to first be halted. So if Midway was the turning point, the Battle of the Coral Sea pretty much had to be the stopping point.
Japanese expansion had run amok throughout early 1942, with success following smashing victory. Their latest attempt at conquest, code-named Operation Mo, had two major goals. First, there was the capture of Port Moresby, on the southeast coast of New Guinea. Historians strongly doubt that Japan was preparing to invade Australia (though with their recent successes, it wouldn’t have been a huge surprise). More likely the hope was to knock Australia out of the war, costing the U.S. a prized ally and removing more armed forces from the region. The second goal was a presence in the Solomon Islands, which they accomplished with the May 4th landings on the island of Tulagi.
Because the U.S. had broken the Japanese communications ciphers, naval commanders had some idea of what was brewing and set off to intercept. The action that took place on May 7, 1942, in the first carrier force-versus-carrier force engagement, seems at first somewhat trivial when compared with subsequent battles, but the longer-term consequences were tremendous…for both sides.
First, let’s go to geography class for a refresher. The Coral Sea is the body of water between northwest Australia and southeast New Guinea. If you walk down the long southeast tail of New Guinea and swim out a couple hundred miles, you’d be pretty close to the battleground.
Scout planes from both sides had difficulty locating each other (remember, radar in 1942 was still really new and used with much skepticism). And when enemy ships were spotted, they weren’t properly identified. Japanese scouts found a fueling ship and a small destroyer, but reported back that they had found “a carrier and a cruiser”. So Admiral Takeo Takagi sent off a major attack force that completely overwhelmed the opposition, but they missed the main force centered around the carrier USS Lexington. The same thing happened with the Americans, though with slightly better success and they sunk the light carrier Shoho (shown above).
Land-based Japanese aircraft also spotted U.S. naval forces (again, not the main carrier force for which they were looking), but their attacks did no damage. Late in the day Takagi sent out 30 carrier-based planes to look for targets, but nearly all were shot down or lost trying to return to the ships at night.
All these skirmishes led the the Japanese commanders to one conclusion…they had no idea what kind of enemy they were facing. So the Port Moresby operation was postponed until further information could be gathered.
Action on May 8th would see the Japanese score big by sinking the USS Lexington and damaging the USS Yorktown, while the U.S. would extract a pound of flesh from (but not sink) the Shokaku. But by then, the results were in…the invasion was off. While pretty much ending in a tactical draw, the U.S. had prevented an invasion, they had sunk an enemy carrier, and they had downed a bunch of planes. At home (and on the ships), the news of any success resounded as a huge victory.
The Japanese expansion, at least for May 7, 1942, had been checked. The stage for The Miracle was now set.
Recommended Reading: Coral Sea, Midway and Submarine Actions, May 1942-August 1942 – Volume 4 of History of United States Naval Operations in World War II. I’ve mentioned the U.S. Army in World War II series…this is the Navy’s answer, and Morison’s work is epic.

Excellent article and the take on how it affected Midway was well done.
The Battle of the Coral Sea was the second of 4 battles that would turn the tide in the Pacific. The first was Pearl Harbor, a most fatal victory for Japan. The Japanese only succeeded in awakening the USA in wrath. Although 6 Battleships were sunk, one of those was a target ship and 4 others were later raised and refitted to see action again. Only the USS Arizona was never raised and remains a memorial to this day. The Japanese failed to take out any of the Carriers (which would haunt them at Coral Sea and Midway), failed to destroy any facilities (at least, meaningful ones), so the USA still had a full functioning military facility (harbor, airfields, fuel and ammo dumps, etc.). Coral Sea saw the Japanese effectively lose two fleet class carriers that were suppose to be used at Midway. Imagine if the Japanese had two more carriers at that battle. Midway saw the Japanese lose 4 carriers, effectively ending it’s ability to carry out further offensive fleet action. To partially make up for this seaplane tenders were converted to carrier duty, reducing Japan’s ability to carry out long range reconnaisance at sea. This hampered Japan’s ability to effectively defend itself. Guadalcanal was Japan’s last last attempt to keep the momentum going. After that Japan was pretty much on the defensive, except for its attempted invasion of India in 1944.