The total compensation a salesperson earns if they hit 100% of quota.
OTE is base salary + target variable comp (bonus + commission) at 100% quota attainment. Typical split is 50/50 for AEs (half base, half variable), 60/40 for SDRs. Exceeding quota means earning above OTE, often with accelerated commission rates. Missing quota means earning below OTE, sometimes way below.
OTE is how you recruit salespeople. It's the number candidates quote to each other. 'I'm a $250k OTE AE' means something specific. Know the OTE range for your type of role at competitive companies; if you're below market, you won't hire well.