Virgin Orbit drops a Launcher One rocket from under the wing of its modified Boeing 747 in a key test before the company's first launch.

Sir Richard Branson's other space company Virgin Orbit completed a key test of its Boeing 747-based launch system on Wednesday.

Virgin Orbit flew its modified aircraft above the Mojave Desert in California and dropped a dummy rocket from tens of thousands of feet in the air, to test one of the key parts of its launch system. The company plans to use the rocket to launch satellites to space, with the "air launch" system giving a schedule flexibility that Virgin Orbit touts over more common ground-based launch systems like those of SpaceX and Rocket Lab.

"This drop test is the final major demonstration in a development program that's been going on for four and a half years," CEO Dan Hart told CNBC before the test. "It's a huge deal ... separating developmental work from the beginning of operations for us and getting to orbit."

Instead of a payload, the rocket for the drop test has a hunk of metal in its nose. And, instead of fuel, the test rocket is carrying a load of water and antifreeze to simulate weight.

Hart said that the first rocket the company plans to launch to space is undergoing final checks at Virgin Orbit's factory in Long Beach, California. With checks on that rocket will take place in the weeks following the drop test in the desert, with Hart forecasting Virgin Orbit's first launch "hopefully will be before the end of the summer."

"We're poised to be able to launch our next rocket, which would be our first paying customer, two months, maybe 10 weeks, after the first flight," Hart added.

@Virgin Orbit tweet

Virgin Orbit is a spin-off of Branson's space tourism company Virgin Galactic. While both of the companies launch spacecraft from the air – rather than the ground – that's where the similarities end. Virgin Orbit uses a former commercial jet and will launch satellites the size of refrigerators to orbit, while Virgin Galactic has a one-of-a-kind aircraft and plans to send paying tourists on 10 minute rides at the edge of space.