Two notes about carriage returns in Microsoft Excel:

1. Line feeds are displayed as little squares unless the cell has the text wrap attribute. (The formula bar displays the correct value in all cases.)

2. Being picky, the end of line character should be 0x0A (\n). It's easy to fix that:

<?php
$value = strtr($value, array(
    "\r\n" => "\n",
    "\r"   => "\n",
));
?>