What does OTE mean in a job offer?

OTE stands for On-Target Earnings — the total annual compensation you'd receive if you hit 100% of your sales quota. It includes your base salary plus variable commission. If a job posts '$180K OTE,' you'll earn $180K total when hitting quota, not $180K base.

How is OTE calculated?

OTE = Base Salary + Commission at 100% Quota. For example, with a $90K base, $600K annual quota, and 10% commission rate: OTE = $90K + ($600K × 10%) = $90K + $60K = $150K.

What is a typical base-to-variable split for OTE?

For Account Executives, 50/50 is standard (half base, half variable). SDRs/BDRs typically see 60/40 or 70/30. Sales managers lean toward 65/35. The more influence a rep has on deal outcomes, the higher the variable percentage.

No. OTE assumes 100% quota attainment. Your guaranteed pay is only the base salary. Some companies offer a ramp guarantee (full OTE for the first 2-3 months regardless of performance), but after ramp, commission is earned.

What is a good quota-to-OTE ratio?

A typical quota-to-OTE ratio in SaaS is 4-6x. For example, if your OTE is $200K, your annual quota would be $800K-$1.2M. Below 3x signals quotas may be too easy; above 8x may indicate unrealistic targets.

OTE Calculator

Calculate on-target earnings from base salary and commission, evaluate OTE in a job offer, or find the quota you need to hit your target comp.

Enter Your Data

Enter your base salary, annual quota, and commission rate to calculate OTE

Industry Benchmarks: OTE Calculator

OTE benchmarks are in thousands ($K). Ranges reflect US market data and vary by geography, company stage, and deal complexity. SaaS OTEs are typically split 50/50 base:variable for AEs and 60/40 for SDRs.

Industry	Low	Average	High
SaaS (SDR)	60%	78%	95%
SaaS (AE Mid-Market)	150%	180%	220%
SaaS (AE Enterprise)	220%	280%	350%
SaaS (Account Manager)	100%	130%	160%
Financial Services (AE)	120%	175%	250%
Medical Devices (AE)	150%	200%	280%
Manufacturing (AE)	80%	110%	150%
Insurance (Agent)	50%	80%	120%

How to Use the OTE Calculator

Step-by-Step Instructions

1Select a mode: Calculate OTE, OTE from Offer, or Quota from OTE.
2Enter your base salary, commission rate, quota, or OTE — depending on the mode.
3Click Calculate to see your results instantly.
4Use the interpretation to understand whether your comp structure is standard for sales roles.

Formulas Used

On-Target Earnings

OTE = Base Salary + (Annual Quota × Commission Rate ÷ 100)

OTE is total compensation at 100% quota attainment: base salary plus the commission earned by hitting your full annual quota.

Variable Component

Variable = OTE − Base Salary

The variable (at-risk) portion of compensation. For most AE roles, variable is 40-60% of OTE.

Required Quota

Quota = (OTE − Base Salary) ÷ (Commission Rate ÷ 100)

Reverse-calculate the annual sales quota needed to achieve a target OTE at a given commission rate.

Quota-to-OTE Ratio

Ratio = Annual Quota ÷ OTE

How many dollars in quota for each dollar of OTE. A typical ratio is 4-6x for SaaS companies.

Frequently Asked Questions: OTE Calculator

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On-Target Earnings (OTE) Explained
Complete guide to OTE: what it means, how it's calculated, and how to evaluate it.

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