Sales pay explained
What is OTE? On-target earnings explained
OTE stands for on-target earnings. It is the total amount a sales rep earns in a year when they hit exactly one hundred percent of quota. You will see it in almost every closer job ad, usually written as something like 60k base, 120k OTE.
How OTE is calculated
The formula is simple: base salary plus variable pay at quota. Variable pay covers commission and any bonus that is tied to target performance.
OTE = base salary + commission at 100 percent of quota
Base 60,000 plus commission 60,000 gives an OTE of 120,000 at a 50/50 split.
The pay mix, or split
The split describes how much of OTE is guaranteed. A 50/50 mix is standard for high ticket closers, 60/40 is common for account executives with longer cycles, and pure commission roles run at 0/100. The higher the variable side, the more your income depends on close rate rather than tenure.
What OTE does not tell you
OTE is a target, not a promise. Only the base is guaranteed. Before you accept a number, ask what percentage of the team actually hit quota last year, whether commission is capped, when accelerators kick in, and how long the ramp period pays out at reduced quota.
OTE versus what you really earn
Your real earnings come from deals closed, not from the number in the offer letter. That is why closers track attainment monthly rather than annually: earned to date against goal, average commission per deal, close rate and value per call. Those four figures tell you whether OTE is realistic long before the year ends.
CalcuCloser keeps that math live. You log deals, calls and meetings, set a monthly commission goal, and see earned to date, goal attainment, close rate and what a single dial is worth, in USD and EUR side by side.