A refrigeration cycle apparatus includes a compressor, a water-refrigerant heat exchanger, pressure reducing devices which reduce the pressure of a refrigerant, an air-side heat exchanger, an outdoor fan which delivers air to the air-side heat exchanger, a geothermal-side heat exchanger, a switching device which switches a flow passage so that the air-side heat exchanger or the geothermal-side heat exchanger functions as an evaporator, and a controller. The controller controls the switching device so that, when the geothermal-side heat exchanger functions as an evaporator, the air-side heat exchanger and the water-refrigerant heat exchanger are connected in parallel, and stops the outdoor fan.